Netherlands GDP Q4 2016

Netherlands

Netherlands: Economic growth in the Netherlands moderates in Q4 on falling fixed investment

February 23, 2017

The Netherlands’ economy slowed in the final quarter of 2016, on the back of weaker private consumption and dropping fixed investment. Conversely, both government consumption and the external sector’s contribution to growth improved compared to Q3. GDP grew 0.5% in seasonally-adjusted terms over the previous quarter, according to preliminary data released by Statistics Netherlands on 14 February, decelerating from Q3’s 0.8% expansion, but nonetheless marking the eleventh consecutive quarter of growth. The economy grew 2.3% in Q3 over the same quarter last year, which represented a slight acceleration compared to Q3’s 2.4% expansion, bringing the growth rate for 2016 as a whole to 2.1%.

In Q4, private consumption growth decelerated from the 1.0% recorded in Q3 to a 0.7% increase. Moreover, fixed investment deteriorated from the 0.2% drop recorded in the third quarter to a 2.9% fall, an almost four-year low. On the upside, government consumption gained steam, swinging from the 0.3% contraction in Q3 to a 0.6% expansion in Q4.

On the external front, growth in exports of goods and services accelerated, recording a 1.4% expansion, up from the 1.1% growth observed in Q3, marking the highest reading in six quarters. Growth in imports of goods and services mirrored Q3’s 1.0% expansion. Consequently, the external sector’s net contribution to overall economic growth in Q4 was 0.5 percentage points, up from Q3’s 0.2 percentage points and marking the largest net contribution in two and a half years. More detailed data will be released on 24 March.

For 2017, FocusEconomics Consensus Forecast panelists see GDP growing 1.8%, which is unchanged from last month’s projection. For 2018, the panel expects the economy to expand 1.7%.


Author: Massimo Bassetti, Economist

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