'Very Rare Effect': Why Beyoncé is being blamed for inflation in Sweden

Rising inflation is often attributed to issues like the current global economic slump, aggressive monetary policies by central banks, the conflict between Ukraine and Russia, and the ongoing demand-supply problem. But that’s the not case with Sweden. Economists at a significant bank have pinned the blame on American singer Beyoncé. Swedish inflation dropped below 10 per cent in May, according to official statistics, but it was still higher than anticipated. Some analysts believe that Beyoncé, the world’s most famous singer, may have tipped the scales by beginning her global tour in Stockholm. Let’s take a closer look. Inflation in Sweden Consumer prices rose by 9.7 per cent in May year-on-year, down from 10.5 per cent in April, the first time inflation came in under 10 per cent in over six months, according to AFP. “Continued decrease in electricity and food prices contributed to the lower inflation rate in May,” Mikael Nordin, a statistician at Statistics Sweden, said in a statement. At the same time, costs of certain goods and services rose, “for instance hotel and restaurant visits, recreational services, and clothing,” the agency said. [caption id=“attachment_12744052” align=“alignnone” width=“640”] Fans of US musician Beyonce queue to enter to the Friends Arena to watch her first concert of the World Tour named “Renaissance”, in Solna, north of Stockholm. AFP[/caption] Also read: Why Britain is experiencing more inflation than the EU and the US Beyonce is blamed According to Michael Grahn, chief economist for Sweden at Danske Bank (Denmark’s largest bank), Beyoncé’s visit to the country’s capital city of Stockholm could explain why the inflation rate was higher than expected. “Beyoncé’s start of her world tour in Sweden seems to have coloured May inflation, how much is uncertain,” Grahn said in a post on social media. He added that her much-hyped concert in May “probably” accounted for 0.2 of the 0.3 percentage points added to inflation by hotels and restaurant prices, as per the report. Tens of thousands of fans flocked to Stockholm in the middle of May to catch the two concerts that kicked off her first solo tour in seven years. Estimates put the crowd at each concert at 46,000, with some forced to stay outside the capital as hotels filled up. Many fans reportedly flew from outside to watch the performances, taking advantage of the depreciating Swedish krona and cheaper ticket prices, according to the BBC. “I wouldn’t … blame Beyoncé for [the] high inflation print, but her performance and global demand to see her perform in Sweden apparently added a little to it,” he wrote in an email to the BBC. Also read: The Big Bang Theory: Is Sweden hosting a sex championship? “A very rare effect” The Wall Street Journal quoted Grahn as saying that the effect was “very rare” and that he anticipated things to be back to normal in June. But one analyst warned the Financial Times (FT) that when Bruce Springsteen performs three nights of concerts in Gothenburg in June, Sweden might see a similar increase in inflation. Inflation in Sweden peaked in December at 12.3 per cent – a more than 30-year high – then slowed slightly in January to 11.7 per cent, but unexpectedly spiked back to 12 per cent in February. Like its peers in the United States and Europe, Sweden’s central bank has repeatedly hiked its guiding rate in an effort to rein in inflation. The Riksbank raised the rate to 3.5 per cent in late April and said it would “probably” raise it by another quarter-point in June or September. Inflation adjusted for fixed interest rates (CPIF) – the figure used by the Riksbank to guide monetary policy – was 6.7 per cent in May, compared to 7.6 per cent in April. For 2023 as a whole, the central bank expects the Swedish economy to contract 0.7 per cent and has forecast unadjusted inflation of 8.9 per cent and rising unemployment. Concert concerns Most economists agree that Beyoncé’s tour will have less impact this month, but many are worried about her upcoming huge concert in Sweden, reported India Today. Another significant event slated for the end of June is the three nights of Bruce Springsteen in Gothenburg, which worries Andreas Wallström, head of forecasting at Swedbank. He worries that it might cause inflation to rise similarly. Beyoncé’s Renaissance tour began in Stockholm, the capital of Sweden, and travelled to Brussels, Cardiff, Edinburgh, and five nights in London before ending in the city that is also the capital of the United Kingdom. She will have seven more appearances in Germany, the Netherlands, and Poland before travelling to Canada and the US, according to a report from the Financial Times. The inflation numbers for the other nations, however, have not yet shown their influence. Large sporting events frequently skew economic statistics, although economists claimed that it was uncommon for a single event to do so. With inputs from AFP Read all the  Latest News,  Trending News,  Cricket News,  Bollywood News, India News and  Entertainment News here. Follow us on  Facebook,  Twitter and  Instagram.