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Netherlands GDP declined 8.5 percent in Q2 2020

Christian Fernsby |
According to the second estimate conducted by Statistics Netherlands (CBS), gross domestic product (GDP) declined by 8.5 percent in Q2 2020 relative to Q1 2020.

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The second GDP estimate is published approximately 90 days after the end of each quarter.

The growth rate is the same as in the first estimate, which was published on 14 August.

The overall picture of the economy has also remained unchanged.

More than half of the GDP decline over Q2 is attributable to the nosedive in household consumption, while investments in fixed assets and the trade balance also decreased sharply.

Compared to the first estimate, investments in fixed assets, including investments in construction, computers and R and D, have been adjusted upwards.

The trade balance has been adjusted upwards as well.

However, household consumption has been adjusted downwards.

The second estimate is conducted 90 days after the end of the quarter.

The first estimate, which is calculated 45 days after the end of the quarter, is based on the most recent data available at that moment.

After the first estimate, more new information about the state of the Dutch economy keeps pouring in, e.g.

data about the sectors construction, business services, accommodation and food services, government, care and financial institutions.

These data are subsequently incorporated into new calculations.

In absolute terms, the adjustment of the second estimate relative to the first estimate has averaged nearly 0.04 percentage points over the past half decade, with the two extremes amounting to - 0.1 and + 0.2 percentage points.

With each new GDP estimate, CBS also recalculates the seasonally adjusted series of previously published quarters.

The quarter-on-quarter GDP growth rates in previous quarters has not been adjusted.

Year-on-year, GDP declined by 9.4 percent in Q2.

In the first estimate, this was 9.3 percent.

The overall picture of the economy has remained unchanged.

The year-on-year contraction was mainly due to lower household consumption, but investments in fixed assets and the trade balance declined as well.

Compared to the first estimate, output in the manufacturing sector has been adjusted downwards across the board.

Production in the sectors financial services and information and communication has been adjusted downwards as well.

Output in the sectors trade and business services was higher than previously calculated.

The second estimate shows that the number of employee and self-employed jobs decreased by 297 thousand in Q2 2020 compared to the previous quarter.

The first estimate suggested a decrease of 322 thousand jobs.

Relative to Q2 2019, the second estimate for Q2 2020 suggested a contraction of 178 thousand employee and self-employed jobs, versus 223 thousand according to the first estimate.

Job figures are adjusted when additional source data becomes available.

During the first estimate, the response for the third month in each quarter is still low.

Due to new data on the month of June, the picture is now less negative than in the first estimate.

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