During the first quarter of 2021, Belgium and Luxembourg experienced a partial recovery in their economic activity, recording an increase in their y/y GDP growth rates relative to 4Q20, whereas that of the Netherlands remained stable. As far as inflation is concerned, the Netherlands recorded the highest rate, with Belgium being the only country whose rate decrease compared to the previous quarter. Regarding the labour market, Belgium, Luxembourg and the Netherlands reached lower unemployment levels than in the fourth quarter.


Macroeconomic outlook report: Benelux 1Q21

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Macroeconomic overview

  • Belgium: In the first quarter, the Belgian economy continued its recovery, with a 4.30 p.p. increase in their GDP relative to the previous quarter. However, the y/y variation of its GDP registered once again a negative rate, standing at -0.60%. Regarding the inflation rate, it decreased to 0.54% after a fall of 0.01 p.p. with respect to the fourth quarter. In turn, the unemployment rate declined 0.37 p.p., down to a 5.47% rate.
  • Netherlands: The y/y growth rate of the GDP of the Netherlands remained stable when compared to the fourth quarter of 2020, recording for the second consecutive quarter a -2.80% rate. In turn, it recorded an inflation rate of 1.77% after an increase of 0.77 p.p., which placed Netherlands once again as the Benelux country with the highest inflation rate. Regarding the unemployment rate, it decreased 0.50 p.p., down to 3.57%, the lowest rate of the three countries.
  • Luxembourg: In the first quarter of 2021, Luxembourg's economy registered a 3.20 p.p. increase in its y/y GDP variation rate with respect to the previous quarter, recording a rate of 4.90%. Regarding the unemployment rate, it continued falling, down to a 6.24% rate, after a decline of 0.06 p.p. relative to the fourth quarter. Nevertheless, in spite of this decline, Luxembourg registered the highest unemployment rate of the three countries. In turn, inflation experienced a 0.71 p.p. increase, reaching a 1.26% rate.

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