Inflation holds at 3.1% in the Netherlands as housing and food costs remain high

The cost of living in the Netherlands continued to climb in June, with consumer prices 3.1 percent higher than a year earlier, according to final inflation data released by Statistics Netherlands. While inflation dipped slightly compared to May, prices for groceries, energy, and housing continued to be persistent drivers of higher costs.

Approximately one-third of the overall price increase was attributed to housing-related expenses, including energy and water bills. CBS noted that this trend is striking because more households are generating their own electricity. Those with solar panels, heat pumps or improved insulation likely faced smaller increases. In contrast, households without these measures are paying substantially more than average.

Groceries also continued to rise in price. Products like coffee and chocolate have been expensive for a long period. At the same time, CBS reported that Dutch consumers spent more overall, mainly on services such as insurance, public transport, dining out, events and personal care. Spending on groceries fell slightly.

The modest decline in the overall inflation rate compared to May was largely due to tobacco taxes. In April 2024, the excise duty on tobacco was increased. According to CBS, the impact of such tax hikes remains visible in the inflation figures for about a year. That effect has now started to fade. However, this disappearance is gradual. Retailers can often sell stock purchased before the tax increase for several months, so the lower inflation effect unfolds over time.

Inflation in the Netherlands remains higher than the European average. While energy and product prices have declined across much of the eurozone, Dutch prices have continued to rise. Economists generally prefer to keep inflation near 2 percent, which they consider healthy growth.

Alongside the inflation data, CBS also published figures showing household consumption rose in May. Households purchased 1.1 percent more goods and services than in May 2024, adjusted for price changes and the composition of shopping days.

Consumers spent 1.8 percent more on services, which make up more than half of total household consumption. Purchases of durable goods, such as vehicles, increased by 0.7 percent. Spending on food and beverages fell 0.3 percent, and purchases of other goods — including energy, motor fuels and personal care products — decreased 0.2 percent.

CBS reported that the environment for consumer spending improved in June. According to its Consumption Radar, households were more optimistic about future unemployment, and the decline in stock prices was less pronounced than in May. However, the agency noted that better conditions do not necessarily lead to higher consumption growth.