11 Feb 2016
Dutch Q4 GDP expanding - ING
Dimitry Fleming, analyst at ING Bank, explained that Dutch GDP expanded 0.3% in the final quarter of 2015, in line with consensus.
Key Quotes:
"After 0.1%QoQ in Q3, this seems a disappointing rebound. Household consumption contracted (-0.1%QoQ) and net exports subtracted 0.1 %-points of GDP. The standout was business investment, rising 3.6%QoQ.
That said, dig a bit deeper and today’s GDP report is actually not bad at all. You could even call it solid. It confirms that Q3 was a dip, triggered by uncertainty about the global economy.
Industry and exports of goods have rebounded strongly. Meanwhile, commercial services continued to post healthy growth. In Q4, there was just one area of weakness: gas production.
As a result of exceptionally high temperatures – Nov and Dec were the warmest in over 40 years – the gas sector knocked 0.3% points off GDP growth. On the demand side, lower gas consumption pulled household spending lower.
So, ex-gas spending was actually up. Meanwhile, imports were boosted by temporarily strong demand for vehicles, as new tax rules triggered business to front-load spending (investment in vehicles surged 18%QoQ).
All in all, after today’s report we remain optimistic about the growth outlook for this year.
Industry and exports have rebounded, the economy is adding jobs, wage growth is increasing and household purchasing power is boosted by tax cuts. On the back of this report we may have to trim our GDP forecast for 2016 a bit (currently: 2.5%), but it remains above-consensus (1.9%)."
Key Quotes:
"After 0.1%QoQ in Q3, this seems a disappointing rebound. Household consumption contracted (-0.1%QoQ) and net exports subtracted 0.1 %-points of GDP. The standout was business investment, rising 3.6%QoQ.
That said, dig a bit deeper and today’s GDP report is actually not bad at all. You could even call it solid. It confirms that Q3 was a dip, triggered by uncertainty about the global economy.
Industry and exports of goods have rebounded strongly. Meanwhile, commercial services continued to post healthy growth. In Q4, there was just one area of weakness: gas production.
As a result of exceptionally high temperatures – Nov and Dec were the warmest in over 40 years – the gas sector knocked 0.3% points off GDP growth. On the demand side, lower gas consumption pulled household spending lower.
So, ex-gas spending was actually up. Meanwhile, imports were boosted by temporarily strong demand for vehicles, as new tax rules triggered business to front-load spending (investment in vehicles surged 18%QoQ).
All in all, after today’s report we remain optimistic about the growth outlook for this year.
Industry and exports have rebounded, the economy is adding jobs, wage growth is increasing and household purchasing power is boosted by tax cuts. On the back of this report we may have to trim our GDP forecast for 2016 a bit (currently: 2.5%), but it remains above-consensus (1.9%)."