THE HAGUE, June 12 (Xinhua) -- The Dutch economy is expected to grow by 0.8 percent in 2026, a slower pace than previously forecast due largely to the impact of the conflict in the Middle East, the Dutch central bank (DNB) said on Friday.
According to DNB's Spring Projections, the forecast is 0.4 percentage points lower than the estimate released in December last year. The central bank said uncertainty stemming from the conflict is weighing on economic activity while adding upward pressure on inflation.
"Private consumption growth is stagnating this year. Higher energy prices are depressing growth in real household incomes. Furthermore, declining consumer confidence is leading households to save a larger share of their income," said Bas ter Weel, executive board member for monetary affairs at DNB.
"Companies are reluctant to invest due to uncertainty about market conditions, higher energy costs and rising interest rates. Growth in Dutch exports is also slowing in the first half of the year, in line with weaker global trade growth," he added.
Ter Weel noted that economic growth this year is being driven mainly by government spending, particularly in healthcare and defense.
DNB also warned that the conflict in the Middle East is contributing to higher inflation.
"We now project inflation in the Netherlands at 2.7 percent this year, higher than the 2.4 percent forecast in December 2025," the central bank said in a press release.
Despite the weaker outlook for 2026, DNB expects economic growth to gradually recover in the coming years, reaching 1.2 percent in 2027 and 1.3 percent in 2028. Enditem
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