Economy to shrink 5.4%, says central bank

The Dutch central bank said on Thursday it expects the economy will contract 5.4% this year, with unemployment mounting to up to 9% by 2011.

The biggest shrinkage in the Dutch economy has already occurred, bank economists said in their latest forecasts.
The decline will lessen over the coming quarters, the central bank said. And the first signs of recovery in the US, stock exchange price rises and increased demand for raw materials are all positive developments.
Nevertheless, unemployment will continue to rise, with the jobless total set to reach up to 850,000 by the end of 2011.
The central bank’s forecast is gloomier than the government’s macroeconomic forecasting bureau CPB which said last month the economy would shrink 3.5% this year. It put unemployment as rising to 675,000.

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