inflation

Inflation in the Netherlands increased to 2.7 percent in March, driven largely by higher energy and fuel prices, CBS reported. The rise follows the outbreak of war in the Middle East, which has pushed up oil and gas costs. Economists and the ECB warn that prolonged conflict could keep inflation under pressure.

Mortgage rates in the Netherlands have increased due to the Iran conflict. First‑time buyers, as well as buyers in major cities and the new‑build market, are particularly likely to feel the impact, according to ING Research.

The Dutch economy is expected to grow more slowly after the outbreak of the war in Iran, according to ABN AMRO. The bank has slightly lowered its growth forecasts and warns that inflation will rise more sharply. Despite this, economists say the Netherlands is well placed to absorb the shock.

Inflation could be significantly higher this year due to the war in the Middle East, the CPB warns in its latest forecast. Both the baseline estimate and the risk scenario carry considerable uncertainty. If energy markets remain disrupted, inflation could end up more than a quarter higher than in the CPB’s standard projection, which currently expects inflation to ease to 2.3 percent. It remains highly uncertain how long the conflict will impede oil and LNG shipments through the Strait of Hormuz or prompt Gulf states to reduce energy production.

Rabobank economists warn that the conflict in the Middle East could lead to sharp increases in Dutch petrol and energy prices. In the most severe scenario they examined, fuel could reach €3 per litre and energy bills could rise above €400 per month. Other analysts expect a smaller impact, but say the outlook depends heavily on how long the conflict lasts.

Europe is relying more on domestic demand as global trade conditions become less certain, according to KPMG. The firm warns of slower growth in the eurozone this year but sees signs of improvement ahead. Falling inflation and the rise of artificial intelligence may help support the outlook.

The European Central Bank’s latest interest rate decision offers eurozone households a rare dose of financial calm. Borrowing costs are no longer rising, and...

Consumer price growth in the eurozone has dropped to 1.7 percent, falling below the official target set by the European Central Bank. While energy prices drove the decline, experts are now looking toward Thursday's interest rate decision for the next steps in monetary policy.