Dutch consumer confidence falls to new record low; Companies pull back on investments
Dutch consumer confidence fell further in August, setting a new record low point for consumer opinion on the economy and their personal financial situation. According to figures from the Statistics Netherlands (CBS), consumer confidence bottomed out for the fourth month in a row.
The indicator used by the CBS to measure confidence was minus-54 in August. That is well below the average of minus-9. The sub-indicator that deals with the economic climate and other factors also turned negative. Furthermore, consumers are also less willing to make purchases, setting another new low. This is potentially related to rising prices and the associated decline in purchasing power.
Consumer confidence reached its all-time high in January 2000. Then the gauge was at plus-36.
Consumers have never been more pessimistic about the past 12 months of the economy and the upcoming year since measurements began in 1986. Both the opinion about the financial situation in the past twelve months and the opinion about the financial situation in the coming twelve months deteriorated, according to Statistics Netherlands.
Meanwhile, companies in the Netherlands are also becoming less enthusiastic when it comes to making new investments. The CBS surveys investment conditions on a regular basis, and found that sentiment among entrepreneurs decreased in August compared to June. This is mainly due to the rise in interest rates and the fall in consumer confidence.
Companies invested slightly more in June than a year earlier, the latest figures showed. The increase was mainly due to the additional investments in aircraft, ships, homes, buildings and machines. Total investments increased by 8.2 percent year-on-year. May had also shown gains.
Reporting by ANP