Netherlands: Consumer confidence deteriorates but remains in positive territory in March
Consumer confidence fell to minus 39.0 in March from February’s minus 30.0. March’s result marked the weakest sentiment since March 2013. As a result, the index indicated prevailing pessimism among consumers.
Sentiment took a hit on the back of the war in Ukraine, with views on the general economy in the next 12 months souring. Moreover, willingness to buy also deteriorated as consumers’ views on their financial situation in the year ahead turned more pessimistic. Russia’s invasion of Ukraine has sent energy commodity prices soaring, which eats into consumers’ pockets and erodes their purchasing power.
Analysts at the EIU added:
“After strong growth of 4.8% in 2021 […] the fallout from the conflict in Ukraine will affect the pace of Dutch real GDP growth in 2022. We do not currently expect the impact […] to push the economy into recession, but we have downgraded our 2022 growth forecast by 0.6 percentage points, to 3.1%. We expect weaker private consumption growth, as disposable incomes are hit by higher inflation […].”