Economic situation deteriorating

The picture of the economic situation at the end of December was far worse than at the end of November. This is mainly because the confidence of the manufacturing industry has collapsed completely. The heart of the indicators in the Business Cycle Tracer is now clearly located in the recession stage.

Dutch economic growth is slowing down. In the third quarter, economic growth was 1.8 percent compared with one year previously. Growth was almost reduced by half compared with the first six months of 2008. The Dutch economy showed zero growth in the third quarter compared with the second quarter. This is the second time in a row that there was no quarter-on-quarter growth.

In October manufacturing production was 2.5 percent down on last year. Export volume was 1 percent up. Consumption expenditure grew by 0.2 percent compared with one year previously.

Confidence among manufacturers collapsed in December. The indicator plummeted from -9,1 to -20,1. This is the lowest level since 1985, the first year the index was calculated on a monthly basis. The mood among business service providers also deteriorated substantially. Consumer confidence hardly changed in December. This indicator stood at -28 in December, compared with -29 in November.

In November, capital market interest averaged 4.0 percent, i.e. nearly 0.3 of a percentage point down on October. The Dutch inflation rate dropped from 2.8 percent in October to 2.3 percent in November. Selling prices in manufacturing industry were over 2 percent down on November 2007.

Seasonally adjusted unemployment did not change in the period September-November compared with the period August-October. Job growth in the third quarter of 2008 was less vigorous than in the first six months. The number of job vacancies remained high, the number of hours worked in temp jobs decreased marginally.

Gross domestic product (GDP)