Finance

Dutch economy enters recession as inflation bites

The Dutch economy has entered a recession as it shrank 0.3% on a quarterly basis in the second quarter, a first estimate published by Statistics Netherlands on Wednesday showed.

The euro zone’s fifth largest economy shrank for the second consecutive quarter, after a 0.4% contraction in the first three months of the year.

Economic growth in the Netherlands had been almost 5% per year in 2021 and 2022 in a quick recovery from a COVID-19 slump.

The first recession since the pandemic was driven by a drop in consumer spending and exports, as surging inflation drove up food prices and energy bills in the Netherlands and its trading partners.

Consumer spending fell 1.6%, while exports were 0.7% lower than in the first three months of the year.

Inflation in the Netherlands has dropped since hitting a peak of 14.5% in September last year, but was still relatively high at around 6% in the second quarter of 2023.

Source : Reuters

GLOBAL BUSINESS AND FINANCE MAGAZINE

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