Netherlands GDP


Netherlands: Economy shrinks in first quarter

May 20, 2014

In the first quarter, GDP dropped 1.4% in seasonally-adjusted terms over the previous quarter according to the first estimate released by Statistics Netherlands on 15 May. The reading came in below expectations of a flat reading and marked a deterioration over the 1.0% growth recorded in Q4. This represented the first decline after two consecutive quarters of modest growth and marked the largest contraction since Q2 2009.

On the domestic side, gross fixed investment fell 3.5% over the previous quarter (Q4: +7.0% quarter-on-quarter). Private consumption dropped 0.9% in the first quarter (Q4: +0.3% qoq) and government consumption increased slightly from the flat reading tallied in the previous quarter to a 0.2% expansion.

On the external front, exports of goods and services inched up from a 0.3% expansion in Q4 to a 0.4% increase in Q1. Imports of goods and services declined from 0.7% growth in Q4 to a 0.2% drop in Q1. Consequently, the external sector’s net contribution to overall economic growth rose from minus 0.3 percentage points in Q4 to 0.5 percentage points in Q1.

The Dutch Central Bank expects GDP to expand 0.5% in 2014 and sees growth picking up to 0.9% in 2015. For 2014, FocusEconomics Consensus Forecast panelists see GDP growing 1.0%, which is unchanged from last month’s projection. For 2015, the panel expects the economy to expand 1.3%.

Author: Teresa Kersting, Economist

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