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Market environment

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Key macro developments 2023

The key events and developments for the Dutch economy can be summarised as follows:

  • Dutch economic growth stagnated at 0.0%. High interest rates and inflation pushed consumer spending growth into negative territory and driving the overall economy into a technical recession that ended in Q4 2023. Due to the low unemployment rate the economy did not witness the negative effects of a traditional recession and remained relatively stable. In addition, the tight labour markets also enabled high average wage growth figures which were not seen since the 1970s. This restored the purchasing power of consumers substantially but did not keep up with inflation.

  • Inflation rates peaked in Q4 2022 before starting to decline in 2023. Energy costs were substantially lower than in 2022, but prices of food, fashion and footwear were the major drivers of overall inflation in 2023. By the end of the year inflation rates settled at 1.2% and returned to below historically average levels.

  • In an attempt to temper inflation, central banks continued to increase policy interest rates in 2023. The ECB increased the deposit interest rate by 200 basis points to 4.0%. As a result, interest rates on 10-year government bonds increased as well and were highly volatile over the year. In November and December, these rates dropped significantly by nearly 100 basis points to 2.3% on expectations that central banks will decrease policy rates in 2024 as inflation rates have returned to pre-Covid levels in Q4 2023.

  • Together with declining interest rates at the end of the year, consumer confidence recovered from the all-time low levels. On the contrary, producer confidence is deteriorating over the year. Concerns about orders and business activity have a dampening effect on confidence.

  • Unemployment rates remained relatively stable at around 3.5% during 2023, thereby reflecting the tight situation on the labour market. Unemployment seemed to remain unaffected by the rising number of bankruptcies, almost doubling from the year before as governmental financial support from the Covid-period ended. The tight labour market enabled a substantial increase in the average wage level by nearly 7% in Q4 2023. However, this increase is not sufficient to offset high inflation from the past years.

Information on the market outlook can be found in Bouwinvest's Dutch Real Estate Market Outlook 2024-2026.







Consumer spending



Consumer price index (CPI)*



Interest rate government bonds, long-term*



Unemployment rate*



*Average numbers over the year

Source: Oxford Economics (11 January 2024)