People walk past restaurants and bars in Amsterdam, Netherlands Oct 14 2020. REUTERS/Piroschka van de Wouw/File photo
AMSTERDAM – The Dutch economy has entered a recession as it shrank 0.3 percent on a quarterly basis in the second quarter, a first estimate published by Statistics Netherlands on Wednesday showed.
The euro zone’s fifth largest economy shrank for the second consecutive quarter, after a 0.4- percent contraction in the first three months of the year.
Economic growth in the Netherlands had been almost 5 percent per year in 2021 and 2022 in a quick recovery from a COVID-19 slump.
The first recession since the pandemic was driven by a drop in consumer spending and exports, as surging inflation drove up food prices and energy bills in the Netherlands and its trading partners.
Consumer spending fell 1.6 percent, while exports were 0.7 percent lower than in the first three months of the year.
Inflation in the Netherlands has dropped since hitting a peak of 14.5 percent in September last year, but was still relatively high at around 6 percent in the second quarter of 2023.