Consumer confidence in the Netherlands remains deeply negative in December

Dutch consumer confidence remained unchanged at a sharply negative level in December, as a slightly gloomier view of the economy offset a modest improvement in consumers’ willingness to spend, Statistics Netherlands (CBS) reported.

The consumer confidence index held steady at minus 21, the same level as in November. That reading is well below the average of the past 20 years, which stands at minus 11.

Consumers were marginally more pessimistic about the economic climate. The economic climate subindex slipped to minus 35 in December from minus 34 a month earlier. While views of the economic situation over the past 12 months improved slightly, expectations for the coming 12 months deteriorated.

Willingness to buy improved modestly. The purchasing inclination index rose to minus 11 in December from minus 12 in November.

Consumers reported a better assessment of their financial situation over the past year, but their outlook for the next 12 months weakened slightly. The time to make large purchases was seen as a fraction less unfavorable than in November.

CBS measures consumer confidence as the average of five survey questions, calculated as the balance between positive and negative responses. A score of 100 indicates that all respondents are positive, while minus 100 means all are negative. The index has been compiled monthly since April 1986.

Historically, Dutch consumer confidence peaked at 36 in January 2000 and hit a record low of minus 59 in September and October 2022.

Underlying indicators showed mixed movements in December. The balance for the economic situation over the past 12 months improved to minus 46 from minus 47, while expectations for the economic situation in the next 12 months fell to minus 24 from minus 21. The balance for whether it is a favorable time to make major purchases improved slightly to minus 26 from minus 27.

Assessments of the financial situation over the past year improved to minus 10 from minus 14, while expectations for the coming year slipped to 4 from 5.

Concerns about unemployment weighed on sentiment. About 46 percent of respondents said they expect unemployment to rise over the next 12 months, while 10 percent foresee a decline. The resulting balance, minus 37, is the lowest level since May 2021. The weakest reading ever recorded for unemployment expectations was minus 88 in March 1993.