The second quarter GDP growth rate that Statistics Netherlands (CBS) reported today was even better than expected in recent monthly forecasts (0.6%). This strong 1.0% rate follows a quarter-on-quarter contraction of 0.3% in the first quarter amid a weak trade environment. It also brings an end to a period of seven quarters of stagnation with mild contraction.
GDP growth translated into an expansion of employment in the second quarter, albeit at a slower pace than in previous quarters, as weak GDP did not prevent more people from obtaining a job. Although the strain on the labour market is decreasing somewhat now that labour costs are increasing, the number of vacancies is still higher than the number of unemployed people. A lack of personnel remains the most often reported main factor limiting non-financial businesses.
Photo: Dreamstime
The Dutch economy particularly benefited from an improvement in foreign demand in the second quarter. Total exports expanded by 1.3% QoQ. This improvement was thanks to the considerable growth of goods exports, which expanded by 1.7% QoQ.
The industrial production figure suggests that this solid goods export performance was to some extent driven by the pharmaceutical industry, chemical industry, basic metals, and mining & quarrying.
The overall consumer confidence indicator was still higher in 2Q24 than in 1Q24. Concerns about unemployment and inflation, however, rose in the second quarter. It is quite likely that this is related to very visible elements of (expected) inflation.
Among Dutch industries, manufacturing was among the best performers in value added growth in the second quarter, expanding by a strong 3.3% QoQ.
More information:
ING
www.think.ing.com