Dutch pension funds lose €54 billion in first three months of 2025

Dutch pension funds lost 54 billion euros in the first quarter of 2025 due to currency losses and declining stock markets, according to data released Tuesday by De Nederlandsche Bank (DNB). The drop marks a 3 percent decrease in the overall value of their investment portfolios.

The losses were driven largely by the weakening U.S. dollar. Dutch pension funds manage a total of 1.77 trillion euros in assets, of which approximately 551 billion euros are held in U.S. dollars. The depreciation of the dollar resulted in a 24 billion euros loss, DNB reported.

In addition to the currency impact, falling stock prices reportedly contributed to the downturn. Investments denominated in euros lost 16 billion euros, while holdings in other foreign currencies fell by 11 billion euros.

“Exchange rate movements were unfavorable for foreign investments, especially due to the weakening of the dollar,” the central bank stated. Typically, falling exchange rates are offset by rising equity markets, helping funds mitigate losses. However, this counterbalance reportedly failed in early 2025, as both the dollar and stock markets declined simultaneously.

DNB noted that this dual drop was partly caused by uncertainty surrounding U.S. President Donald Trump's policy direction, which contributed to market instability.

Pension funds typically hedge part of their currency risk using derivatives — financial instruments that move in the opposite direction of currency changes. These derivatives generated 11 billion euros in gains in the first quarter, reportedly helping to cushion the blow from the falling dollar.

Separately, the Dutch state pension (AOW) will rise from July 1. According to the social insurance bank SVB, single pensioners will receive 1,612.44 euros gross per month — an increase of about 30 euros. Pensioners in a couple will receive 1,103.97 euros each before tax.

The increase is tied to the statutory minimum wage, which will rise to 14.40 euros per hour next month. Single pensioners receive 70 percent of the minimum wage, while each member of a couple receives 50 percent, based on the assumption that living costs are shared.

To qualify for a full AOW pension, individuals must have lived in the Netherlands for 50 continuous years. With the retirement age currently set at 67, someone who immigrated at age 27 would only be eligible for 40 percent of the full pension.