Slight decline in exports slows down recovery in Dutch manufacturing industry

Demand from other European countries was particularly weak, according to the survey purchasing managers. The preliminary PMI for the eurozone a week and a half ago did not bode well. The preliminary score for manufacturing in the eurozone fell from 47.3 to 45.6, the lowest reading in six months. In Germany, the most important export market for the Dutch manufacturing industry, production fell rapidly.

Fortunately, the number of new orders in the Netherlands continued to rise slightly, thanks to domestic demand. However, it remains to be seen whether this will last, given the deteriorating situation in other European countries. It is possible that the Dutch industry is already preparing for a recovery of the machinery industry, for example at chip machine manufacturer ASML.

Dutch economy contracted due to manufacturing industry

Last week, Statistics Netherlands (CBS) announced that the Dutch economy shrank by 0.5 percent in the first quarter, according to a second estimate, while Statistics Netherlands (CBS) previously reported a contraction of only 0.1 percent. For the second estimate, CBS used additional data and made a series of adjustments to the calculation method. The new figures show that the Dutch economy contracted mainly due to a decline in exports of goods, which is related to a decline in industrial production.

The Dutch manufacturing industry probably performed better in the second quarter than in the very weak first quarter. Since April, the Nevi Purchasing Managers' Index has indicated an improvement in business conditions and clear growth in production. The (preliminary) CBS figures for the month of April confirm this. Despite the slight decline in the number of new export orders in June, it is likely that the Dutch manufacturing industry exported more in the second quarter than in the first quarter.