A river under the bridge in the Netherlands

Netherlands Economic Forecast

Netherlands Economic Outlook

According to a preliminary estimate, GDP declined again in sequential terms in Q2. In the third quarter, our Consensus is for mild GDP growth. Private consumption should benefit from wage gains above the rate of inflation, notwithstanding downbeat consumer confidence. However, business confidence turned pessimistic in August, while exports contracted at a faster annual rate in July than in Q2. Moreover, higher interest rates will dampen overall economic activity. In other news, on 19 September, the caretaker government presented the 2024 budget. It includes additional expenditure amounting to 0.2% of GDP, which is specifically targeted at poverty reduction. That said, Parliament may request amendments that would further increase government spending.

Netherlands Inflation

Harmonized inflation decelerated sharply to 3.4% in August (July: 5.3%) due to softer price pressures for food and energy. Inflation will more than halve this year from 2022 due to slower demand growth and lower average energy prices. Higher-than-expected commodity prices and labor market tightness pose upside risks.

This chart displays Economic Growth (GDP, annual variation in %) for Netherlands from 2013 to 2022.

Netherlands Economic Data

2018 2019 2020 2021 2022
Population (million) 17.2 17.3 17.4 17.5 17.6
GDP (EUR bn) 774 813 797 871 959
GDP per capita (EUR) 45,049 47,046 45,757 49,819 54,491
Economic Growth (Nominal GDP, ann. var. %) 4.9 5.0 -2.0 9.3 10.1
Economic Growth (GDP, ann. var. %) 2.4 2.0 -3.9 6.2 4.3
Domestic Demand (ann. var. %) 2.4 3.0 -4.2 4.7 3.8
Private Consumption (ann. var. %) 2.2 0.9 -6.4 4.3 6.5
Government Consumption (ann. var. %) 1.7 2.8 1.6 5.0 1.6
Fixed Investment (ann. var. %) 3.6 6.2 -2.6 2.9 1.8
Exports (G&S, ann. var. %) 4.3 2.0 -4.3 7.9 4.5
Imports (G&S, ann. var. %) 4.7 3.2 -4.7 6.2 3.8
Industrial Production (ann. var. %) 0.6 -0.9 -3.6 4.8 2.5
Retail Sales (ann. var. %) 2.9 2.3 4.2 2.9 0.1
Disposable Income (ann. var. %) 2.7 2.4 2.3 2.3 2.0
Unemployment (% of active population, eop) 4.6 4.3 4.9 3.8 3.5
Unemployment (% of active population, aop) 4.9 4.4 4.9 4.2 3.5
Fiscal Balance (% of GDP) 1.5 1.8 -3.7 -2.4 0.0
Public Debt (% of GDP) 52.4 48.5 54.7 52.5 51.0
Inflation (HICP, ann. var. %, eop) 1.8 2.8 0.9 6.4 11.0
Inflation (HICP, ann. var. %, aop) 1.6 2.7 1.1 2.8 11.6
Inflation (PPI, ann. var. %, aop) 3.0 0.9 -4.2 12.5 23.8
ECB Refinancing Rate (%, eop) 0.00 0.00 0.00 0.00 2.50
ECB Overnight Deposit Rate (%, eop) -0.40 -0.50 -0.50 -0.50 2.00
3-Month EURIBOR (%, eop) -0.31 -0.38 -0.55 -0.57 2.13
10-Year Bond Yield (%, eop) 0.39 -0.08 -0.50 -0.03 2.90
Stock Market (var. of AEX %) -10.4 23.9 3.3 27.7 -13.7
Exchange Rate (USD per EUR, eop) 1.14 1.12 1.22 1.14 1.07
Exchange Rate (USD per EUR, aop) 1.18 1.12 1.14 1.18 1.05
Current Account Balance (EUR bn) 72.1 56.3 41.0 105.5 88.9
Current Account Balance (% of GDP) 9.3 6.9 5.1 12.1 9.3
Merchandise Trade Balance (EUR bn) 71.6 60.1 61.7 73.2 73.6
Foreign Direct Investment (EUR bn) 86.9 -1.0 -70.7 -68.1 -63.1

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