Decelerating growth, persisting underinvestments

Economic growth is slowing down in the Netherlands due to the decline in global growth and, to a lesser extent, the issues around nitrogen and PFASs. Unemployment reached its lowest point in 2019, but will also remain exceptionally low in 2020. Labour market shortages are leading to an increase in contract wages. Inflation will slow down next year, as the impact of last year's increase in indirect taxes fades away. The budget surplus is projected to decline as a result of expansionary policies and weaker growth, but the reduction is attenuated by significant underinvestment. The main risks to the Dutch economy relate to US trade policy and the Brexit, both this year and the next, but there are also domestic risks caused by the issues around nitrogen and PFASs.