Netherlands: Fixed investment boosts the economy in the first quarter
May 13, 2011
In the first quarter, GDP increased a seasonally adjusted 0.9% over the previous quarter, according to data released by Statistics Netherlands (CBS, Centraal Bureau voor de Statistiek). The result came in above the 0.7% increase registered in the fourth quarter (previously reported: +0.6% quarter-on-quarter) and exceeded market expectations of a quarterly increase of 0.7%. On an annual basis, the economy grew 3.2% in Q1, up from the 2.5% increase registered in the fourth quarter. Domestic demand drove economic growth in the first quarter, as fixed investment skyrocketed 9.8% over the previous quarter (Q4: +0.5% qoq). On the other hand, private consumption contracted 0.5% over the previous quarter, contrasting a 0.5% increase in the fourth quarter. External demand for Dutch goods was dampened in the first quarter, as exports declined 0.2% over the previous quarter (Q4: +1.9% qoq). On the other hand, imports improved and expanded 1.5% in Q1, up from a 1.0% increase in the fourth quarter. As a result, the net contribution from the external sector to overall economic growth deteriorated from 0.9 percentage points in the fourth quarter to minus 1.4 percentage points in the first. The Central Bank expects GDP to grow 1.6% in 2011 and 1.7% in 2012.