Swedish consumers are facing a surge in hotel and restaurant prices following Beyoncé’s “Renaissance” world tour kick-off in Stockholm. Michael Grahn, Danske Bank’s chief economist, attributes two-thirds of the price increases in the hospitality sector to the overwhelming demand from Beyoncé’s dedicated fanbase, known as the BeyHive. This unexpected impact has not only affected the economy but also influenced Sweden’s overall inflation rate.
Grahn explains that the scarcity of accommodations in Stockholm led hotels located up to 50 kilometers away to raise their prices. The effect of Beyoncé’s concerts on the local economy was more significant than anticipated, surprising economists who rarely witness such pronounced consequences.
The surge in hospitality prices resulted in a milder decline in overall inflation, with consumer price inflation decreasing to 9.7% in May from the previous month’s 10.5%. Economists expected a sharper slowdown to 9.4%. Beyoncé’s concerts and the subsequent increase in spending by her fans played a role in this outcome.
Fans traveled to Sweden due to relatively cheaper ticket prices and the advantage of a favorable exchange rate for the weak Swedish currency. Some American fans reported purchasing tickets for Beyoncé’s Swedish concerts at a significant discount compared to shows in the United States.
While the impact of Beyoncé’s concerts on the hospitality sector has been substantial, Grahn predicts it will be short-lived. Hotel prices are expected to decline in June as the initial surge subsides. However, he does note the possibility of upward price pressure when Bruce Springsteen performs in Gothenburg later this month. Nevertheless, Grahn believes the Beyoncé effect was unique and not the typical pattern observed with other artists.
Beyoncé’s decision to start her “Renaissance” world tour in Stockholm has caused an unforeseen surge in hotel and restaurant prices, impacting the Swedish hospitality sector. The overwhelming demand from the BeyHive has contributed to a milder decline in overall inflation. Economists anticipate that the effect will be short-lived, with hotel prices projected to decrease in the coming months.