Modest consumption growth

Household spending on goods and services was 0.5 percent up in July 2014 from July 2013. In May and June household spending was approximately at the same level as one year previously. Prior to the stabilization and modest growth, household consumption had been in decline for nearly three years. Consumption figures have been adjusted for price changes and differences in the shopping-day pattern.

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

Spending on food and services increase most notably

Household spending on food, drinks and tobacco was 1.1 percent up in July from twelve months previously. Spending on durable goods, e.g. clothes, shoes, furniture and cars also increased (0.6 percent). Spending on other goods (including natural gas), on the other hand, was 3.5 percent down from July 2013. Household spending on services grew by 1.1 percent.

With 0.6 of a percentage point, household spending on services contributed most to July’s 0.5 percent consumption growth. More than half the amount of total domestic consumption involves spending on services, for instance paying rents, travelling by bus or train, visiting restaurants or hairdressers or paying phone bills or insurance.

Contribution to consumption growth (volume, adjusted for shopping-days), July 2014

Circumstances for consumption marginally more unfavourable

On balance, circumstances for consumption have deteriorated in somewhat in September. The rise in Dutch share prices compared to one year previously was obviously smaller than in the preceding month. Dutch manufacturers are more pessimistic about future employment in their branch and consumers are more pessimistic about their personal financial situation. The Household Consumption Radar also shows some improvements. Consumers are less negative about unemployment over the next twelve months and the reduction of the employed labour force compared to one year previously was less substantial.

More figures can be found in dossier Business cycle.

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