Netherlands Economic Forecast

Netherlands Economic Outlook

October 27, 2020

The economy likely emerged from recession in Q3, although conditions remained fragile. Retail trade turnover plunged in August, while consumer and business confidence levels remained entrenched in pessimistic territory, which will have capped both household and capital expenditure. Nevertheless, manufacturing operating conditions improved in the quarter. Turning to Q4, further storm clouds gathered on the horizon in recent weeks, with a surge in new Covid-19 cases leading to renewed containment measures. The new restrictions announced in mid-October have seen cafes, bars and restaurants close their doors for four weeks, while travel has been severely restricted and social gatherings limited once again. These measures will derail recently regained momentum in the final quarter of a bleak year for the economy.

Netherlands Economic Growth

After suffering a sharp contraction this year due to the pandemic, the economy is forecast to recover strongly next year as domestic and foreign demand pick up steam. However, the balance of risks remains tilted to the downside owing to lingering uncertainty surrounding the pandemic and its effects. Moreover, the recovery will be flattered by a supportive base effect. FocusEconomics Consensus Forecast panelists see the economy expanding 3.5% in 2021, which is down 0.2 percentage points from last month, and growing 2.5% in 2022.

Netherlands Economy Data

2015 2016 2017 2018 2019
Population (million)16.917.017.117.217.2
GDP per capita (EUR)40,82741,71943,21245,05247,049
GDP (EUR bn)690708738774811
Economic Growth (GDP, annual variation in %)2.02.22.92.61.8
Domestic Demand (annual variation in %)6.9-0.72.32.12.4
Consumption (annual variation in %)2.01.12.12.31.4
Investment (annual variation in %)29.2-7.34.23.25.3
Exports (G&S, annual variation in %)7.41.76.53.72.4
Imports (G&S, annual variation in %)14.5-2.06.23.33.1
Industrial Production (annual variation in %)-3.41.31.40.6-0.9
Retail Sales (annual variation in %)2.61.93.02.92.4
Unemployment Rate6.96.04.93.83.4
Fiscal Balance (% of GDP)-2.00.01.31.41.7
Public Debt (% of GDP)64.661.956.952.448.6
Inflation Rate (HICP, annual variation in %, eop)0.50.71.21.82.8
Inflation Rate (HICP, annual variation in %)0.20.11.31.62.7
Inflation (PPI, annual variation in %)-5.0-2.54.83.00.9
Policy Interest Rate (%)-  -  -  -  -  
Stock Market (annual variation in %)4.19.412.7-10.423.9
Exchange Rate (vs USD)-  -  -  -  -  
Exchange Rate (vs USD, aop)-  -  -  -  -  
Current Account (% of GDP)6.28.010.810.8-  
Current Account Balance (EUR bn)43.457.179.984.283.0
Trade Balance (EUR billion)46.854.358.556.656.4

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Netherlands Facts

Value Change Date
Bond Yield-0.065.70 %Jan 01
Exchange Rate1.120.65 %Dec 31

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