- 15 May
- The Netherlands
Six in 10 Dutch households intend to cut back on spending in response to higher energy and fuel prices, according to ING’s daily survey. Although such pessimism dampens the outlook for consumption and GDP in the Netherlands for 2026, an expansion is still expected
The Iran war has sharply driven up oil and gas prices. Consumers in the Netherlands expect such elevated fuel prices to persist. Among respondents to ING’s daily Question of the Day survey, more than 80% believe elevated prices will last three months or longer.
As early as March, these expectations pushed Dutch consumers’ median inflation expectations for the coming 12 months up noticeably to 3.7% year-on-year. The resulting erosion in purchasing power will clearly dampen consumer sentiment. In April, confidence fell to the lowest level since December 2022.
Most households expect a noticeable financial impact
First and foremost, there’s a widespread belief that prices are putting pressure on Dutch household budgets. Only a small minority of households expect to feel little or no impact from higher prices. The vast majority of Dutch households anticipate a tangible strain on their finances amid higher prices. More than one in three expect to have to cut back materially or even run into financial difficulties. This highlights that, while average household financial positions remain relatively solid, the distributional impact of higher prices matters for consumption patterns.
Majority signal spending cutbacks, often in discretionary categories
Around 60% of consumers cite higher prices as a reason to cut back on spending. Four in 10 households report making behavioural changes to cut their energy and fuel use, such as driving fewer kilometres or turning down the thermostat.
Past energy price shocks show that cutting energy and fuel use meaningfully in the short run is difficult, largely because commuting needs and limited control over home energy efficiency constrain how much households can adjust. Consistent with this, most households that intend to cut back plan to do so by reducing spending in other areas instead. After fuel and energy, hospitality, holidays and leisure activities are most frequently mentioned as cost-cutting categories. Essential items such as groceries are less often targeted for savings.
Surveys signal intentions, not certainties
It is important to stress that survey results capture intentions rather than realised behaviour. Historically, consumers do not always act in line with what they say they plan to do. This may particularly be the case when labour markets remain tight and incomes continue to rise. Although the survey data clearly signals growing caution, it remains unclear how far these intentions will translate into actual, broad‑based spending restraint in the coming quarters.
Targeted government support could limit downside risks
Targeted government measures could help cushion the impact on vulnerable households somewhat and, in doing so, support short-term economic activity. Recent policy announcements primarily focus on lower-income groups and energy-saving measures. Survey evidence suggests that such targeted income support enjoys the broadest public backing by consumers.
Any proposed support measures are generally preferred to government inaction. While such policies – especially given their modest scale so far – are unlikely to eliminate all consumer financial concerns, they could still moderate the tendency of some households to make sharp spending cutbacks.
Growth outlook: more subdued, but still positive
At the macroeconomic level, increased consumer caution implies some additional headwinds to growth. Nevertheless, we do not currently see any indications of an imminent household purchasing strike. Households entered the period before the Iran war from a relatively good position, supported by solid wage growth and low unemployment.
As a result, household consumption is still expected to grow in 2026. However, compared with expectations before the Iran war, consumption growth is now projected to be more muted, reflecting higher inflation, weaker confidence and a greater propensity to save. In that sense, the outlook has softened. But it has not yet turned fundamentally negative.
Our latest forecast for 2026 is for household consumption to expand by 0.5% and GDP by 1.0%. That is mediocre, but not a recession. A shift to a more negative scenario would require further deterioration in upcoming data.
This publication has been prepared by ING solely for information purposes irrespective of a particular user's means, financial situation or investment objectives. The information does not constitute investment recommendation, and nor is it investment, legal or tax advice or an offer or solicitation to purchase or sell any financial instrument.