The seasonally adjusted trade balance was in a €5.47 billion deficit in March, down from February's larger revised €5.61 billion and the smallest shortfall since January 2021.

The improvement in the headline reflected a marked strengthening in both sides of the balance sheet as exports rose a monthly 2.9 percent and imports 2.4 percent. However, while the 3-monthly change in the former now stands at 0.7 percent, the latter's rate remains sub-zero at minus 0.4 percent. On this basis, the trend in the deficit is improving at a moderate pace. Annual export growth was minus 1.3 percent, well above its minus 7.0 percent import counterpart.

However, for overall foreign net trade, much of the recent gain has been due to weaker import prices, and total net exports volumes had only a neutral impact on first quarter real GDP growth.

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.