Dutch Economy to Grow 1.2 Percent in 2015: Central Bank

The Dutch economy is expected to grow 1.2 percent next year as domestic spending and economic sentiment continue to improve, the nation’s central bank said.

“The Dutch economy appears to slowly start shedding the yoke of the credit crisis,” the central said in its semi-annual economic forecast published today. The Amsterdam-based institution forecast the economy to grow 1.5 percent in 2016, down from a previous forecast of 1.6 percent. Growth this year is forecast at 0.8 percent, the bank said.

Along with Spain and Ireland, the Netherlands was hit by a housing collapse in the depths of the euro region’s crisis that sent economic growth tumbling. The recession crippled the nation’s major banks and left the country with record unemployment and mounting consumer debt.

An increased dynamic in the housing market presages further price increases in 2015 and 2016, the central bank said. Housing prices may gain as much as 3 percent in 2016, the bank said. The average house price in the Netherlands in June 2013 was 22 percent lower versus August 2008, the bank said.

The economy grew 0.2 percent in the third quarter after expanding 0.6 percent in the previous three months. It exited a recession in the first quarter of 2013 after a slump largely caused by the housing market.

Unemployment will rise to 6.9 percent in 2014 from 6.7 percent last year, according to today’s report. It will then decline to 6.6 percent in both 2015 and 2016. The nation’s budget deficit will widen to 2.4 percent of output this year from 2.3 percent in 2013. The shortfall will narrow to 2.1 percent in 2015 and 1.8 percent a year later as the economy further recovers, the central bank said.