Netherlands Inflation Expected to Ease by 2026 Amid Economic Pressures
Amsterdam, Monday, 17 November 2025.
Despite current high inflation driven by service and food costs, the Netherlands anticipates a gradual decrease by 2026, with steady GDP growth, highlighting Eurozone economic adjustments.
Current Economic Landscape in the Netherlands
As of 2025, the Netherlands is grappling with a high inflation rate, primarily driven by rising costs in services and processed food. The Harmonized Index of Consumer Prices (HICP) inflation was reported at 3.3% in the first half of 2025, up from 3% in the previous year [1]. This increase reflects broader pressures within the Eurozone as economies adjust to post-pandemic dynamics and geopolitical tensions [1].
Projected Economic Adjustments
Despite the current inflationary pressures, forecasts suggest a gradual easing of inflation rates by 2026. The HICP inflation is expected to decrease to 2.5% in 2026 and further to 2.1% by 2027 [1]. This anticipated decline is accompanied by a steady GDP growth outlook, with real GDP growth projected to slow to 1.3% in 2026 due to uncertainties in investments and exports but is expected to recover to 1.7% in 2027 [1].
Impact on Labor and Investment
The labor market in the Netherlands is experiencing changes, with the unemployment rate rising to 4.0% as of September 2025, and projections indicate a further increase to 4.1% in 2026 and 4.3% in 2027 [1]. Investment is expected to contribute modestly to economic growth in 2025 and 2026, driven by public investments in defense, green transition, and housing, while private investment remains subdued [1].
Government Fiscal Policies and Economic Outlook
Fiscal policies are adjusting to these economic conditions, with the government deficit projected to increase to 1.9% in 2025, primarily due to structural cuts in personal income tax [1]. This deficit is expected to reach 2.7% in 2026, influenced by a military pension system reform, but is forecast to reduce to 2.1% by 2027 as this temporary impact subsides [1]. Overall, these economic forecasts underscore the challenges and adjustments faced by the Netherlands within the broader Eurozone context [1].