Swiftonomics is a definition which was coined in 2023, and refers to the economic influence of Taylor Swift. Last year both Taylor Swift’s Eras tour and Beyonce’s Renaissance tour caused a few global economies to have a surge in inflation. They weren’t the only reason, but they certainly added to it. For instance, Taylor Swift, Beyonce, and Barbenheimer added $8.5bn to the US GDP last year according to Bloomberg. And when Beyonce brought her tour to Sweden’s capital city it caused a surge in accommodation and restaurant costs by 3.3% compared to the month before her concert – this similarly happened in Paris.
Now you may or may not know that Taylor Swift is currently on the UK leg of her world tour. This past weekend she played in Wembley to almost 90,000 people per night (she played there three nights and will play another five nights at Wembley in August). The tour has become the largest grossing tour of all time, even beating Elton John’s Farewell Yellow Brick Road tour and Coldplay’s Spheres World tour, who claim the second and third spots respectively. Her concerts are some of the most highly attended concerts of all time, she played Murrayfield in Edinburgh to nearly 73,000 people per night and it made history by being the most people to attend a concert in Scotland.
During her time in Edinburgh (three nights) she brought £100million to the Scottish economy. And it is estimated by the time she completes her UK dates she will have brought around £1bn to the UK economy. This comes from not just ticket costs, but hotel fees, merchandise, cost of food and drink whilst in the host city, car rentals, shopping, transport to the host city, and more unexpectedly outfits to wear to the concert. The average ticket holder for the Eras tour will spend £848 per head on tickets, travel, accommodation and outfits. For reference, I spent just under £400 total on my Eras tour experience, but I had accommodation covered (i.e. I stayed at my family home for free), and I walked to and from Murrayfield from said family home. But I can easily understand how that figure can be reached.
This weekend at Wembley was expected to bring over £300million to London alone, and Liverpool expected a 115% increase in hotel prices during the nights she played at Anfield.
I am a Taylor Swift fan, and I do have a financial point to all this. It’s been proposed that her August Wembley dates clash with a key inflation index day, meaning it might influence the Bank of England interest rate discussions and even push rate cuts back.
Current consensus is that there will be two rate cuts this year. The market is pricing in that the Bank of England will cut in the August meeting, down from 5.25% to 5%, and then we will see a further cut in November or December to 4.75%.
However, with the Taylor Swift Wembley dates clashing with the key inflation date, some are theorising that it could be enough to sway the MPC to delay a rate cut till September. Again, this is merely a potential factor to be considered, there is still the issue of sticky service price inflation. Currently wage and service inflation remains at around 6%.
But it got me thinking about the influence events of even a one-three night tour can have on an entire city and country’s economy. And events which the market has never fully accounted for before. We are all aware of the financial cost and benefits of hosting large sporting events like the Olympics or the Euros. For example, it is estimated that Germany will see a €3.8 billion boost to its hotel and retail sectors during the Euros (where Scotland are now officially out of the competition). But that is mainly one country benefiting, now look at the Taylor Swift tour and its impact on almost every country and city she plays in happening simultaneously.
I think we all knew the increasing power celebrities have, from influencing brands, even getting people to register to vote, and even impacting share prices on single stocks. Look at some of Tesla’s share price moves when Elon Musk has tweeted, or when Kylie Jenner said she didn’t use Snapchat anymore and its share price fell by $1.3bn. But now add in the potential to influence financial markets by delaying rate cuts…it has definitely reached new territory.
Emily Cave – Research Analyst
FPC24167
All charts and data sourced from FactSet
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