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GDP growth is projected to remain broad-based and steady at around 2%. Private consumption will benefit from improving labour market conditions. The housing market will strengthen further on the back of low interest rates. Wages are set to accelerate as unemployment continues to decline, while inflation will increase gradually from its low level. The current account surplus is expected to remain high despite firm domestic demand and lower gas exports.
Very accommodative euro area monetary policy is supporting demand. The fiscal policy stance is projected to be broadly neutral. Continuing to improve skills, particularly of immigrants and the long-term unemployed, and better matching skills to jobs, would raise productivity and potential GDP growth while also helping to make growth more inclusive.
The public finances are healthy, which provides room that should be used to finance more growth-friendly spending, notably investment in education and R&D. The tax system can be made more efficient, equitable and environmentally friendly, and preparations for a broad tax reform should be revived. In view of the robust housing market recovery, the reduction of mortgage interest tax relief should be accelerated.
Economic Survey of the Netherlands (survey page)