The impact of coronavirus on the Dutch economy is difficult to forecast but it will definitely have an effect, according to the latest forecasts from the government’s macro-economic think tank CPB.

The agency’s spring forecast puts economic growth this year at 1.4%, but says that if the virus is not brought under control quickly, then the negative impact will be more pronounced and could cut growth by 0.8 percentage point.

American trade policy and the economic relationship between Britain and the EU will also have an impact on the Dutch figures and are contributing to the uncertainty, the CPB said.

The Dutch forecast – 1.4% this year and 1.6% in 2021 – is modest but good, given the slowdown in world trade and the lower growth in the Netherlands’ surrounding countries, the agency said.

However, the impact of cutting PFAS and nitrogen-compound pollution will depress growth by 0.2% and the construction of new housing will also fall, the CPB said.

Unemployment will remain low – it is currently 3% – and that will lead to higher wages. This, combined with tax and premium cuts, will boost spending power by an average of 2.1% this year.

The spring forecasts mark the start of the government’s 2021 budget deliberations.