Inflation in Sweden has not fallen as expected recently. One economist said it was Beyoncé’s fault. The American singer kicked off her world tour in the Swedish capital Stockholm.
“Renaissance” is the title of her new album, and American singer Beyoncé is currently on a world tour. The singer kicked off the tour in the Swedish capital Stockholm in early May. That should have pushed up inflation in Sweden, according to Danske Bank chief economist Michael Grahn.
“Beyoncé is responsible for the extra surprises this month, which is pretty amazing for a solo event,” Graham told the FT. “We’ve never met before.”
Core inflation fell only slightly
In Sweden, inflation was 9.7% in May, compared with 10.5% in April. This means that inflation in May fell below the 10% mark for the first time in months. However, so-called core inflation, which excludes volatile energy and food prices, fell just 0.2% in May, well below economists’ expectations.
Statistics Sweden noted that, in addition to high interest payments on real estate purchases and clothing, rising prices in hotels and restaurants were also a factor in the price rise. Price increases in hotels and restaurants alone contributed 0.3 percentage points to Swedish inflation, according to the statistics agency.
“The Beyoncé Effect”
Grahn calls it the “Beyoncé effect.” Hundreds of thousands of fans from all over the world traveled to Stockholm for the opening concert on 10 May – allowing hoteliers to demand higher prices. Similar effects have been known from large sporting events, according to the Financial Times. That’s why economists also assume the effect will fade again in June.
The singer is on tour for the first time in seven years and the tour announcement has already sparked a huge demand for tickets. On Thursday, the singer will perform the first of three German concerts in Cologne. In the following week she will also appear in Hamburg and Frankfurt, concerts that have been sold out for months. So far, what Grahn calls a “Beyoncé effect” has emerged, but not yet in inflation data for other countries where the singer has performed.
Will there be a “Springsteen effect” soon?
By the way, people there are hoping that Bruce Springsteen’s concert in Gothenburg will also have a “Beyoncé effect”. Andreas Wallstrom, head of forecasting at Swedbank, told the Financial Times he was concerned that Springsteen’s concert could also lead to higher prices in the hotel and restaurant sector.