France Trade Balance EUR came in at €-4.8B below forecasts (€-4.1B) in December

💡 DMK Insight

France’s trade balance missing forecasts is a red flag for the Eurozone economy. A deficit of €-4.8B versus the expected €-4.1B could signal weakening demand for French exports, which is concerning given the current economic climate. This could lead to a bearish sentiment around the euro, especially as traders look for signs of economic resilience. If this trend continues, we might see increased volatility in EUR/USD pairs, particularly if the deficit widens further in upcoming months. Keep an eye on the next release of trade data and how it correlates with other economic indicators like GDP growth and inflation rates. On the flip side, if the euro weakens significantly, it could make French goods cheaper for foreign buyers, potentially boosting exports in the long run. However, the immediate impact is likely to be negative, so traders should monitor the €1.05 level in EUR/USD as a key support point. A break below that could trigger further selling pressure.