For a better understanding of the sensitivity of French exports to exchange rate fluctuations using detailed customs data

For the last three years, the euro has appreciated overall against most currencies, which has increased the price of France’s exports and led to a deterioration in its price competitiveness. Nevertheless, the effects of this increase on trade volumes between France and its main trading partners depend on the sensitivity of exports to price fluctuations, and this sensitivity may vary according to the product being exported and the destination country.

To quantify the price sensitivity of French exports, Customs statistical data can be used to track all goods traded between France and the rest of the world between 2002 and 2017 at a highly detailed level. Using an accounting method, the degree of export price sensitivity can be identified by product and by destination country. It appears that, on the one hand, the most price-sensitive products are agricultural products and products associated with energy, while the least sensitive are products in which the French specialise: transport equipment, agrifood products, clothing etc. On the other hand, exports are more sensitive to price fluctuations when they are sent to the most advanced countries.

Another method, complementary to this typological approach, results in a more detailed study of changes in exports using the traditional tools of short-term analysis, i.e. export equations. Overall, the estimated price-elasticities of products are in line with previous results. In addition, the models reveal that since 2009 the increase in the exchange rate has contributed positively to changes in exports of the most price-sensitive manufactured products.