The Unexpected Beyoncé Effect: Higher Inflation

In Europe’s relentless battle against inflation, another culprit has apparently emerged: Beyoncé.

Last month, when the star kicked off her world tour in Stockholm, fans from all over the world flocked to witness the shows, driving up hotel room prices. This may explain part of the reason why inflation in Sweden was higher than expected in May.

Consumer prices in Sweden up 9.7 percent last month from a year earlier, the country’s statistics office, Statistics Sweden, said on Wednesday. The rate fell from the previous month’s 10.5 percent, but was slightly higher than economists had predicted.

Michael Grahn, an economist at Danske Bank, said the start of Beyoncé’s tour could have “colored” the inflation data. ‘How much is uncertain’ he wrote on Twitterbut it could account for most of the 0.3 percentage point that restaurant and hotel prices contributed to the monthly rise in inflation.

Restaurant and hotel prices rose 3.3 percent in May from the previous month, while prices for leisure and cultural activities and clothing also rose.

Beyoncé’s Renaissance World Tour, her first solo tour since 2016, kicked off May 10 in Stockholm, with two nights at a 50,000 capacity arena. Fans from all over the world took advantage of favorable exchange rates and flew in to buy tickets that were cheaper than in the United States or Great Britain, for example.

Mr Grahn said in an email that he wouldn’t blame Beyoncé for the high inflation rate, but “her performance and the global demand to see her perform in Sweden apparently added a little bit to it.”

He added that the weakness of Sweden’s currency, the krone, would have boosted both demand and cheaper ticket prices. “However, the main impact on inflation came from the fact that all fans needed somewhere to stay,” he said, adding that fans were taking up rooms as far as 40 miles away. But the impact will only be short-lived as prices return this month.

While this is a “very rare” effect, he said Sweden had seen this kind of inflationary effect on hotel prices before during a 2017 Football Cup final when foreign teams played in the country.

“So it’s not unheard of, albeit unusual,” said Mr. Grahn.

Carl Martensson, a statistician at Statistics Sweden, said that “Beyoncé probably had an effect on hotel prices in Stockholm the week she performed here.” But he added: “It should not have been significantly impacted by Swedish inflation in May.”