The elusive growth that the UK economy has struggled to generate may have been given a much needed boost by the first round of Taylor Swift concerts in June, official GDP figures are expected to show next week.
As the US singing superstar prepares to return to Britain for four more dates at Wembley Stadium on her record breaking Eras tour, official GDP data may reveal “Taylor made growth” in June when it is published by the Office for National Statistics (ONS) on Thursday, according to City analysts.
They say that spending on hotels, restaurant meals, and memorabilia by the hundreds of thousands of fans watching her concerts in Edinburgh, Cardiff, Liverpool and London - combined with England’s extended run in the Euro’s men’s football championship - will have helped keep the huge services sector stay in positive territory.
Gabriella Willis, UK economist at Santander CIB, said she was forecasting a respectable 0.7% growth for the second quarter of the year as a whole with a 0.1% advance in June.
She said: “We look for 0.1% growth for the UK economy on the month, with June kicking off the summer of sports with the men’s Euros Football Championship alongside the first UK leg of Taylor Swift’s Eras tour, both helping to lift services output in June.
“We expect the dominant services sector to have grown (albeit rather tepidly, by 0.1%) in June, with largely offsetting moves within the services sub-indices as falls elsewhere temper the Swift and Euros boost.”
In their “week ahead” not to clients the economics team at investment bank Investec said: “Supporting the economy in June was likely the boost to hospitality from the start of the European football championships, which Barclaycard reported to have resulted in greater expenditure in pubs.
“It is also possible that hotels saw higher occupancy rates due to Taylor Swift’s Eras tour coming to the UK in June.”
Investec is also pencilling in 0.7% growth for the second quarter and sees 0.2% progress in June.
Last month some City economists blamed a “Taylor Swift effect” boost to hotel room rates for inflation not falling as they had expected.
If true it may the first time in British history that performances by a single artist have moved the national economic dial.
The GDP data comes in a big week for the UK economy with inflation, wages figures all also being published.
Investec is forecasting a slight rise in the headline rate of inflation, the Consumer Price Index (CPI), from 2% to 2.3% when the July number is published in Wednesday. That comes the day after labour market figures for the three months to June showing a slowdown in underlying wages growth from 5.7% to 5.4%.
