Dutch Q2 growth beats forecasts as exports surge

By Catherine Hornby

AMSTERDAM (BestGrowthStock) – The Dutch economy grew faster than expected in the second quarter, data showed on Friday, as exports surged ahead though domestic demand stayed weak.

The euro zone’s fifth-largest economy grew by 0.9 percent in the three months to June, after revised 0.5 percent growth in the first quarter, Statistics Netherlands (CBS) said on Friday. Economists had expected 0.7 percent growth in the second quarter, a Reuters poll showed.

“It was a bit higher than expected but the gap was not as dramatic as with Germany,” said Aline Schuiling, senior economist at Fortis Bank Nederland.

Data on Friday showed Germany’s economy, Europe’s largest, growing by 2.2 percent in the second quarter. the biggest gain since reunification.

Compared with a year earlier, Dutch gross domestic product (GDP) rose 2.1 percent in the second quarter after a 0.6 percent rise in the first quarter.

Exports, which are equivalent to 70 percent of GDP, rose 11.5 percent in the quarter, driven mainly by foreign demand for products in the chemical, metallurgical and technical industries, CBS said in a statement.

Private consumption was weak, with households spending 0.7 percent more than a year earlier.

“If you look at the components, it’s still exports driving the recovery. The consumer is not really picking up,” said ING’s Marten van Garderen. “It is very important that we get a clear idea of what kind of cutback the government will make so consumers know how (they) will be hit.”

The incoming Dutch government, which is still being formed, is expected to implement up to 18 billion euros in budget cuts.

In June, the Dutch government’s economic policy think tank CPB cut its economic growth forecasts for this year and next, citing uncertainty in the euro zone and delays in forming that new government.

It expects the Dutch economy to grow 1.25 percent this year and 1.75 percent next year.

(Editing by John Stonestreet)

Dutch Q2 growth beats forecasts as exports surge