Decline household consumption slows down

20/12/2013 09:30

Dutch households spent 1.1 percent less on goods and services in October 2013 than in October 2012. The decline is less substantial than in preceding months. This is mainly due to higher car sales. Consumption figures have been adjusted for price changes and differences in the shopping-day pattern.

Household spending on durable goods rose (0.4 percent) for the first time in more than two years. Consumers bought considerably more new cars than in October 2012. The decline in spending on other durable items was less substantial than in previous months, but year-on-year consumption developments may be affected by tax measures. On 1 October 2012, the high VAT rate in the Netherlands was raised from 19 to 21 percent. Pending the higher VAT rate, it was convenient for Dutch consumers to buy expensive items in the period prior to October. As a result, household consumption in October 2012 was relatively low.

Spending on food, drinks and tobacco fell by 2.0 percent relative to 12 months previously. Spending on other goods (like energy) was also substantially down by 5,3 percent. Due to the relatively mild weather conditions, natural gas consumption was significantly lower. Household spending on services was 0.2 percent below the level in October 2012

With the aid of six indicators, the Household Consumption Radar shows whether circumstances for Dutch household consumption have become more or less favourable. In December 2013, the radar shows that circumstances for consumption have marginally deteriorated relative to November.

Domestic household consumption (volume, adjusted for shopping-days)

Domestic household consumption (volume, adjusted for shopping-days)

More figures can be found in dossier Business cycle.

For more information on economic indicators, the reader is referred to the Economic Monitor.