The Dutch central bank, De Nederlandsche Bank (DNB), now forecasts that inflation will remain at 3.2% next year, contradicting earlier expectations of a decrease to 2.8%. Without intervention, high price increases could become entrenched in the Netherlands.
This marks a shift from the optimistic outlook of last summer when DNB predicted a swift end to steep price rises. Currently, inflation in the Netherlands is higher than in most eurozone countries, driven by increased energy, fuel, and food prices.
Despite calls from DNB President Klaas Knot for restraint in wage demands, unions argue company profits are high. DNB board member Olaf Sleijpen does not see a need for a new social accord, suggesting that reasonableness will prevail.
The European Central Bank’s recent interest rate reductions, following prior hikes to 4%, complicate the situation, as the Netherlands lacks monetary policy tools to address inflation directly. Sleijpen emphasizes the importance of government awareness of inflation in policy-making and suggests that agreements on rent increases could help manage inflation.
Source: NOS