Dutch central bank cuts 2026 growth forecast to 0.8% amid rising energy prices

The Dutch central bank on Friday lowered its growth forecast for next year, citing higher energy prices linked to tensions in the Middle East that are expected to weigh on consumers and businesses.

The Dutch economy is now expected to grow by 0.8% in 2026, down from a previous forecast of 1.2%, according to De Nederlandsche Bank (DNB).

“Due to higher energy prices, consumers are tightening their belts. Companies face higher production costs and produce less,” said Bas ter Weel, director of monetary affairs at DNB.

He said government spending continues to support growth, but warned that weaker economic performance would reduce state revenues while increasing pressure on public finances.

“You cannot spend what you do not have,” he said, adding that future spending decisions would need to remain balanced within existing budget limits.

DNB also raised its inflation forecast for this year to 2.7% from 2.4%.

The central bank warned that uncertainty around energy markets continues to weigh on economic outlooks.

It also presented alternative scenarios, including a more severe downturn if tensions around key energy routes persist, as well as a milder path in which growth improves in the coming years.

The central bank also expects unemployment to edge higher.

The downgrade comes amid broader concerns about European growth. On Thursday, the International Monetary Fund lowered its eurozone growth forecast for 2026 to 0.9% from 1.1%.