Dutch still gloomy about economy: confidence well below average level

We still lack confidence in the economy and our own finances. For the third month in a row, consumer confidence has remained unchanged, according to figures from Statistics Netherlands (CBS).

The index is again at -32, just as it was in July and August. This means confidence remains well below the -10 average of the past twenty years.

After a cautious recovery from the low point in October 2022, the improvement stalled during 2024. At that time, consumer confidence seemed to be slowly climbing out of the trough, but that trend has leveled off in recent months.

Historically, the current level is still exceptionally low. In January 2000, the index reached a record high of +36, while consumers were at their lowest ever level in September and October 2022, at -59.

Consumers were slightly more negative about the economy in September than the previous month. Their assessment of the economic situation over the past twelve months deteriorated slightly.

At the same time, confidence in the economy for the next twelve months remained unchanged. This suggests that the Dutch expect little change, although a pessimistic tone still prevails.

The timing for major purchases, such as furniture, cars, or electronics, is still considered unfavorable. This perception has not changed since August.

Yet, there is a silver lining, as consumers are somewhat more optimistic about their own financial situation in the coming year. This assessment has remained unchanged over the past twelve months.

According to economists, the high inflation of recent years continues to contribute to the low level of confidence in the economy. Although price increases have leveled off, many households are still feeling the pinch. Furthermore, uncertainty surrounding the economy, such as the housing market and energy bills, is causing continued reluctance.

Consumer confidence is a key indicator because it often influences spending patterns. Those with low confidence postpone major purchases and are more likely to hold back on spending. Consequently, low confidence can hinder economic growth.