State of the economy: improved

The economic situation in the Netherlands has improved. The Dutch economy grew 1.3 percent in the second quarter of 2005. First quarter growth was still negative. The growth in the second quarter was mainly caused by increased exports and more investments. Other economic indicators, such as expected production in manufacturing industry and anticipated turnover in business services, also provide a more positive picture of the current state of the Dutch economy. However, other indicators do not signal improvement of the economic situation.

After adjustment for seasonal effects and working day patterns, manufacturing output in June-July 2005 equals the level of April-May 2005. However, in the two previous two-month periods there was still a small increase. The volume of goods exported from the Netherlands in July was, after rough correction for working days, 6 percent higher than in July 2004. The growth rate of the export volume remained about the same as in the first six months of 2005. In July the domestic consumption was slightly up. This is the second slight increase in a row.

Entrepreneurs in the business services sector expect more orders and higher turnover in the second quarter. Producer confidence in manufacturing industry improved further in September. On the other hand, consumer confidence remained unchanged in September compared with August. 

Selling prices and prices of intermediate consumption in the manufacturing industry rose in July on June. Inflation reached 1.8 percent in August, up 0.2 percent point on July. The capital market interest rate of the latest 10-y central government loan remained stable in August.

There are no clear signs of improvement on the labour market as yet. Unemployment, adjusted for seasonal effects, was down slightly in June-August. Employment decreased in the second quarter of 2005. The decrease in the number of jobs available is slowing down. In the second quarter the number of vacancies did not rise any further.

Gross domestic product