The seasonally adjusted trade deficit narrowed slightly to €8.60 billion in October from a revised €8.87 billion in September (originally reported as €8.92 billion).

The slight improvement in the external trade position comes as exports increased by 1.2 percent to €49.67 billion, while imports rose by 0.6 percent to €58.27 billion.This follows a disappointing showing in the third quarter when net trade subtracted 0.4 percentage points from gross domestic product, contributing to a 0.1 percent fall in the broader economy.

The data take the French RPI to minus 19 and the RPI-P to minus six, indicating that the French economy is underperforming expectations by a modest margin.

The merchandise trade balance measures the difference between imports and exports of goods. The level of the international trade balance, as well as changes in exports and imports, indicate trends in foreign trade and can offer a guide to an economy's competitiveness.

Changes in the level of imports and exports, along with the difference between the two (the trade balance) are a valuable gauge of economic trends here and abroad. While these trade figures can directly impact all financial markets, they primarily affect currency values in foreign exchange markets. Given the size of the French economy, the euro can be sensitive to changes in the trade balance. The bond market is also sensitive to the risk of importing inflation. This report gives a breakdown of trade with major countries as well, so it can be instructive for investors who are interested in diversifying globally. For example, a trend of accelerating exports to a particular country might signal economic strength and investment opportunities in that country.