June 19, 2019

Forecast June 2019

Growth slowing down to standard rate

Press release
The Dutch economic growth rate is slowing down due to the ill wind blowing from abroad. Export growth is declining. The waning growth in production has had remarkably little impact on the labour market, which remains tight with a, currently, continuing increase in vacancies and rapid employment growth. Unemployment will remain exceptionally low, according to the projections, but will increase slightly in 2020. Purchasing power will see a positive development because of policy and, in 2020, moderate inflation. The government budget will continue to be in surplus. US trade policy, the chances of a no-deal Brexit, and the instable situation in Italy are important downward risks to the Dutch economy. These are the conclusions by CPB Netherlands Bureau for Economic Policy Analysis in its latest June Projections. CPB director, Laura van Geest: ‘Despite a rather standard economic growth rate, employment growth will remain remarkably large. Wage increases will be limited, due to the tight labour market—something that, incidentally, is not a uniquely Dutch phenomenon.’
Main image

  2018 2019 2020
GDP will return to standard growth rate 2,7 1,7 1,5
Unemployment level will remain low 3,8 3,5 3,7
Inflation will be high in 2019, due to taxes, and moderate in 2020 1,6 2,6 1,4
Limited rise in contract wages due to labour shortages 2,0 2,5 2,3
Purchasing power development will remain positive 0,3 1,2 1,4
Government budget in surplus 1,5 1,3 0,6

Spokesmen

Foto Suzanne van Gils
Suzanne van Gils +31 6 21560776 Read more
Dick Morks +31 6 51681611 Read more

This forecast is published in CPB Policy Brief 'Juniraming 2019' (only in Dutch).

Fan Charts June 2019

The figures present fan charts around the June 2019 point forecasts for GDP growth, HICP inflation,unemployment and general government financial balance.

The solid line represents data realizations (2014-2018) and the June 2019 point forecasts for 2019 and 2020.

Around the central path the figures present a fan of confidence intervals:
• 30% confidence interval from the 35th to 65th percentile, dark blue area
• 60% confidence interval from the 20th to 80th percentile, dark blue + blue area
• 90% confidence interval from the 5th to 95th percentile, dark blue + blue + light blue area

The probability is thus 30% that the outcome will fall in the dark blue area and the probability is 10% that the outcome will fall outside the fan. In other words, the fan is a graphical representation of the likelihood of the various outcomes. The solid line represents the most likely outcome and outcomes are more likely when they are closer to the solid line.

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Contacts

Foto Adam Elbourne
Adam Elbourne +31 6 27208196 Read more
June 19, 2019

Forecast June 2019, figures

The Dutch economic growth rate is slowing down due to the ill wind blowing from abroad. Export growth is declining. The waning growth in production has had remarkably little impact on the labour market, which remains tight with a, currently, continuing increase in vacancies and rapid employment growth. Unemployment will remain exceptionally low, according to the projections, but will increase slightly in 2020. Purchasing power will see a positive development because of policy and, in 2020, moderate inflation. The government budget will continue to be in surplus. US trade policy, the chances of a no-deal Brexit, and the instable situation in Italy are important downward risks to the Dutch economy. These are the conclusions by CPB Netherlands Bureau for Economic Policy Analysis in its latest June Projections. CPB director, Laura van Geest: ‘Despite a rather standard economic growth rate, employment growth will remain remarkably large. Wage increases will be limited, due to the tight labour market—something that, incidentally, is not a uniquely Dutch phenomenon.’

Table 'Main economic indicators', 2017-2020, June 2019

  2017 2018 2019 2020
International items
Relevant world trade volume goods and services (%) 5.0 3.2 1.7 2.4
Export price competitors (goods and services, non-commodities, %) 2.1 0.8 1.2 1.2
Crude oil price (dollar per barrel)  54.3 70.9 68.7 66.8
Exchange rate (dollar per euro)  1.13 1.18 1.12 1.12
Long-term interest rate the Netherlands (level in %)  0.5 0.6 0.2 0.4
  2017 2018 2019 2020
GDP and demand (volume)
Gross domestic product (GDP, economic growth, %) 2.9 2.7 1.7 1.5
Household consumption (%) 1.9 2.5 1.4 1.7
Government consumption (%) 1.1 1.3 2.9 2.5
Capital formation (including changes in stock, %) 4.4 4.8 4.3 2.1
Exports of goods and services (%) 5.3 2.7 1.3 2.1
Imports of goods and services (%)  4.9 2.8 2.2 2.8
  2017 2018 2019 2020
Prices, wages and purchasing power
Price gross domestic product (%) 1.2 2.1 2.4 1.5
Export price goods and services (non-energy, %) 1.9 1.0 1.0 1.2
Import price goods (%) 4.2 2.5 0.9 0.5
Inflation, harmonised index of consumer prices (HICP, %) 1.3 1.6 2.6 1.4
Compensation per hour private sector (%) 1.2 2.0 3.1 2.5
Contractual wages private sector (%) 1.6 2.0 2.5 2.3
Purchasing power, static, median all households (%) 0.3 0.3 1.2 1.4
  2017 2018 2019 2020
Labour market
Labour force (%)  0.8 1.2 1.4 1.1
Active labour force (%) 2.1 2.3 1.8 0.9
Unemployment (in thousands of persons) 438 350 325 350
Unemployment rate (% of the labour force)  4.9 3.8 3.5 3.7
Employment (hours, %)  1.9 2.4 2.1 0.7
  2017 2018 2019 2020
Other items
Labour share in enterprise income (level in %) 73.4 73.6 75.1 75.6
Labour productivity private sector (per hour, %) 0.9 0.3 -0.4 1.0
Private savings (% of disposable household income)  2.9 3.1 3.7 4.0

Current-account balance (level in % GDP)

10.5 11.0 10.2 9.6
  2017 2018 2019 2020
Public sector
General government financial balance (% GDP) 1.2 1.5 1.3 0.6
Gross debt general government (% GDP) 57.0 52.4 49.1 47.0
Taxes and social-security contributions (% GDP)  38.7 38.8 39.3 38.8
Gross government expenditure (% GDP) 43.0 42.3 42.3 42.6

Contacts

Foto Wim Suyker
Wim Suyker +31 6 52485860 Read more
Daniel van Vuuren Read more
Foto Sander van Veldhuizen
Sander van Veldhuizen +31 6 11648608 Read more

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