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Netherlands Economic growth is projected to moderate to 0.9% in 2023 before picking up to 1.4% in 2024. Headline inflation is expected to fall to 2.2% in 2024 on the back of declining energy prices, but core inflation will remain elevated at 3.9%. Growth is supported by private consumption, aided by energy support measures and increases in benefits since the beginning of 2023. After slowing in 2023, export growth is expected to improve in 2024 as external demand picks up. Private investment will slow due to higher uncertainty, rising interest rates and lower credit availability. The labour market will remain tight, although the unemployment rate will edge up to 4.1% by late 2024. The fiscal stance is slightly expansionary. Annual real expenditure ceilings defined in the fiscal policy framework have been exceeded since 2020, and the government should aim to return to the fiscal rules. Continuing to tackle structural challenges should be a priority, focusing on accelerating the green transition and reducing labour market tightness. Economic activity started to slow GDP contracted by 0.7% in the first quarter of 2023 due to falling exports and a decline in gas inventories. Private investment contributed positively to growth and producer sentiment remained above its long-term average. While private consumption stalled, consumer confidence and the willingness to buy have improved since the beginning of 2023, albeit from historically low levels. Price pressures continue, with headline inflation remaining elevated at 6.8% in May. Rising service prices contributed to persistently high core inflation of 8.2% in May. The labour market remains tight with less than one unemployed person per vacancy. Collective labour agreement wages were up 5.7% in May over a year earlier. Housing market corrections are continuing, with the prices of owner-occupied dwellings falling by 4.4% over the year to April and the number of sales declining by almost 20%.
Netherlands
Source: CBS. StatLink 2 https://stat.link/tozpg4
OECD ECONOMIC OUTLOOK, VOLUME 2023 ISSUE 1: PRELIMINARY VERSION © OECD 2023