US Tariffs Expected to Reduce Dutch GDP Growth by 1%

U.S. tariffs implemented under President Trump are projected to reduce Dutch GDP growth by approximately 1% by the end of 2026, according to multiple analyses from the Netherlands Bureau for Economic Policy Analysis (CPB) and De Nederlandsche Bank (DNB). The tariffs, which include a 25% levy on steel and aluminum and affect over 8% of Dutch exports to the U.S., are expected to increase costs and economic uncertainty, leading to a significant drop in investment and lower export demand. However, the impact on inflation is expected to be limited due to a weaker U.S. dollar reducing import costs for the Netherlands. While the manufacturing sector is anticipated to suffer from reduced competitiveness, the service sector may see some benefits as the economy adjusts. Both CPB and DNB expect the negative effects to be more pronounced in the short term, with some recovery possible as Dutch companies seek alternative markets over time. If the European Union retaliates with its own tariffs, the consequences could be more severe, but the overall inflationary impact would likely remain modest.