What does Beyoncé have to do with inflation in Sweden?
Could the latest jump in Sweden’s inflation come down to … Beyoncé?
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High inflation rates have contributed to Europe’s cost-of-living crisis, which the region has been dealing with for over a year now – with the war in Ukraine gumming up Europe’s economic systems.
But could the latest jump in Sweden’s inflation come down to … Beyoncé?
Last month, the globally famous pop star kicked off her Renaissance World Tour in Stockholm, Sweden. And her concerts there may have had some unforeseen consequences. These two shows at Friends Arena made up the first stop on her first world tour since 2016 and brought in over 80,000 fans.
The shows sparked super high demand for hotels, restaurants and other services and shops in the city. And all that demand could’ve affected some of the country’s economic stats. Sweden’s May inflation rate rose 9.7%, which was higher than expected. Restaurant and hotel prices rose 3.3% in May compared to April, and the prices of other cultural and recreational activities and clothes also saw a boost.
Michael Grahn, an economist at Danske Bank, posted on Twitter, “Beyonce's start of her world tour in Sweden seems to have colored May inflation, how much is uncertain, but probably 0.2 p.p. of the 0.3 p.p that hotels/restaurants added. Perhaps also hiked concert ticket prices (recreation). Otherwise as expected.”
According to Grahn, the show itself wouldn’t have contributed to inflation as much as the fact that the fans traveling in to see Queen Bey all needed somewhere to eat and sleep. The concert tickets were actually relatively cheap, coming in at around US$400, compared to US$900 in Washington, DC. So, even a lot of fans from the US were flying in to snag the cheaper tickets after missing out on concerts in their home country.
This kind of effect isn’t totally unheard of in Sweden. Back in 2017, something similar happened during a soccer cup final hosting foreign teams in Stockholm.
“All in all, May inflation numbers were a disappointment and came out clearly higher than we had expected,” Nordea bank economist Torbjorn Isaksson said. “It is a high outcome, not least considering the broad upturn, reinforcing the view that the Riksbank will hike rates in June.”
Grahn did say on social media, though, that he expects things to get back to normal in June once the “Beyoncé effect” has passed.
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