ING expecting a moderate growth of 1.3 percent for the Dutch economy next year

The Dutch economy will continue to grow at a moderate pace, ING economists expect. The growth is mainly pushed by demand within the country, while exports will be under pressure due to economic weaknesses in Germany and China. The protectionist trade policy of incoming President Donald Trump also creates uncertainty. Trump is threatening higher import tariffs on products from outside the United States.

ING predicts that the economy will grow by 1.3 percent in 2025 after a weak growth of 0.8 percent this year. The increase in purchasing power is an important reason that the economy can grow.

However, according to ING, it is uncertain to what extent consumers will convert this into additional purchases or additional savings. The government also continues to contribute to growth with higher spending.

The tightness in many areas of the economy is predicted to continue, even though the economy has shown shrinkage for more than a year. According to ING, the lack of staff is still the biggest issue for most companies. In addition, the growth is limited by a lack of space and connection to the electricity grid.

Inflation will also remain high. The Netherlands currently has one of the highest inflation rates in the eurozone. This is due to a variety of factors, including the high wage increases, tightness in the housing market, and taxes, levies, and excise duties.

Now that the European Central Bank (ECB) is lowering interest rates to support the economy and the Dutch budget deficit is rising, there appears to be little help to get inflation back to 2 percent in a quick manner, ING economists think.

The higher wage costs are also putting pressure on companies' profits, which will likely lead to a slight increase in unemployment in 2025. Consumers will likely be careful with the expenditures because of the increase in unemployment. This is despite the higher wages that they will be receiving.

ING also expects housing prices to continue to rise next year due to higher wages, stable interest rates, and the continued tightness of the housing market.

However, due to an expected weakening of wage growth, sales by real estate investors, and slightly rising unemployment, house prices will rise less rapidly in 2025 than this year.