Households trimmed spending in the first two months of 2005. The volume of domestic consumption by households in February was 1.0 percent down on February 2004. Consumers spent far less on durable goods than one year previously. In January 2005 domestic consumption was 0.7 percent lower, according to figures published by Statistics Netherlands. The figures have been corrected for price changes and differences in shopping day patterns.
Consumers spend less on durable goods
In February households cut back on spending on durable goods compared to the same month one year previously. The sale of new cars, for instance, fell sharply. Consumption of durable goods is easily affected by the economic situation. Spending on non-durable goods, such as food, drinks and tobacco is hardly affected by the economic climate. In February 2005 consumption of food, drinks and tobacco was virtually equal to February 2004, after correction for price changes and differences in shopping day patterns. The same applies to spending on services.
Volume developments in household consumption only marginally contributed to economic growth in the Netherlands in the last couple of years. Domestic consumption, after a decline in 2003, slightly recovered in 2004. Increased spending on care services as a result of new legislation, largely accounted for the recovery. In the first two months of 2005 household consumption was again below the level of one year previously.
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