The Dutch economy is set to grow by 1.5% in 2025 and 2026. However, global geopolitical tensions are giving rise to a great deal of uncertainty and are posing a growing threat to our economy. Inflation in the Netherlands is still too high, and will remain around 3% in the years ahead. These figures were revealed in our December 2024 Autumn Projections.
After a record high of 11.6% in 2022, inflation fell to 3.2% in 2024. We expect it to remain at 3.2% in 2025 and fall to 2.8% in 2026. This means inflation in the Netherlands will remain above the inflation rate for the euro area in the years ahead. The difference is mainly due to domestic factors: strong demand, high wage growth and rent increases. Higher taxes on tobacco and hotel accommodation, for example, also contribute to inflation in the Netherlands.
Economic growth was 0.9% in 2024 and is projected to be 1.5% in 2025 and 2026. Economic growth in the Netherlands is driven mainly by domestic demand. Private expenditure increased especially in the second half of 2024, thanks to higher household incomes.
As wages rose faster than inflation, households’ real disposable income increased by 4.5% in 2024. Dutch households use part of the increase for additional savings, for example to pay off their mortgage loan or buy a home.
Various factors threaten economic growth in the Netherlands, especially the high international geopolitical uncertainty. As a trading nation, the Netherlands remains sensitive to developments abroad, such as unrest in the Middle East and the Russian war in Ukraine.
Added to this is the threat of a trade war fought with high retaliatory import tariffs. Uncertainty about this has risen sharply since Donald Trump was elected the new US President. A trade war could significantly undermine economic growth in the Netherlands, as our calculations show.
DNB publishes projections for the Dutch economy for the current year and the next two years. We create these together with the European Central Bank (ECB) and other central banks in the euro area. The ECB aggregates national projections into macroeconomic projections for the euro area as a whole. This is how we contribute to the ECB’s decision-making on monetary policy. Every six months, we also share our national forecasts and analyses by publishing our Spring and Autumn Projections. Using this data, we provide advice on economic issues to the government and other policymakers. Our Spring and Autumn Projections provide insight into the basis of this advice, as do our studies.
We prepare our projections for the Dutch economy using a macroeconomic model called DELFI. We also use this model to assess the consequences of changes in economic policy or economic conditions. Want to try your hand at creating your own projections? Get behind the controls with our DELFI Tool and find out how things like higher energy prices and wage increases affect the Dutch economy.
DNB uses different models to assess the short-term economic prospects.
With DFROG, the nowcasting model of DNB, we make an estimate of the current development of the Dutch economy.
With the DNB business cycle indicator turning points in the Dutch economy can be signalled timely. A turning point signals a change in the growth phase of the economy.
From zinc smelters to asphalt producers, and from food producers to refineries – energy and emissions costs are determining factors for the output of much of Dutch industry.
Read more DNB studies industry resilience to cost increases
Today, De Nederlandsche Bank publishes ‘Resilience in turbulent times’, a study on the potential impact of geopolitical risks on financial institutions. DNB economist Maurice Doll co-wrote the study and talks about its main findings.
Read more ‘European cooperation essential to confront geopolitical risks’
We are facing geopolitical instability with the threat of a global trade war on top of a war in Ukraine that has been raging for three years. The world has been turned upside down again in recent weeks. Understandably, this has led to high levels of anxiety and uncertainty among citizens.
Read more Robust policies in an uncertain world
‘We in the Netherlands have little influence on many of the developments currently taking place in the world. But we can do one thing. And that is to work to mitigate the economic consequences and perhaps seize new opportunities.’ Klaas Knot said this at the presentation of DNB’s 2024 Annual Report.
Read more Introductory remarks upon the presentation of the 2024 annual report