Reuters reported that the Dutch economy has entered a recession in the second quarter, shrinking 0.3% on a quarterly basis, according to the first estimate released by Statistics Netherlands on 16th August.
The eurozone’s fifth largest economy contracted for the second quarter in a row, following a 0.4% contraction in the first three months of the year.
Economic growth in the Netherlands was nearly 5% per year in 2021 and 2022, indicating a rapid recovery from Covid-19.
The first recession since the ‘pandemic’ was caused by a drop in consumer spending and exports, as rising inflation increased food and energy prices in the Netherlands and its trading partners.
Consumer spending fell 1.6%, while exports fell 0.7% from the previous three months.
In the Netherlands, inflation has declined since reaching a high of 14.5% in September of last year, but it remains relatively high at around 6% in the second quarter of 2023.