We did it, Britain — we saved CPI on track!
[Twee-est music you ever heard kicks in.]
[In soft, warm Yorkshire accent]
This one’s for the worldwide tourers…
. . . the multi-buy-offer ignorers…
. . . the small mammal adorers…
. . . the focusing on core-ers.
Thanks, Britain.
The pound hit a one-year excessive in opposition to the greenback on Wednesday after UK inflation figures got here in barely above expectations at 2 per cent for June.
Underpinning the stronger-than-expected studying was one key factor: motels.
On the CPIH measure, which incorporates owners’ prices, costs for motels and eating places had been up 0.9 per cent in a month, in contrast with a 0.5 per cent improve over the identical month a yr in the past. The Office for National Statistics said this rise “was nearly solely due to the value of motels”.
Right here, by way of Bloomberg, is year-on-year CPI inflation for motels and, for functions of comparability, live performance/cinema/theatre tickets:
What this text is definitely about
So, we hear you asking, what does this all imply for Taylor Swift?
Effectively, as we somewhat predicted in a non-committal way last week: it actually, actually seems to be as if — shock, horror — she was most likely irrelevant.
First up, these live performance ticket costs. As most individuals most likely know by now, tickets to Swift’s Eras tour, which arrived within the UK final month, had been bloody costly, even on a canopy foundation. And — as we’ve subsequently clarified with the ONS — they might have been imputed into the determine at any time when within the month the precise gig happened (the ONS is versatile on this level to make sure the comparability of various artists).
So the truth that the index barely moved not less than means that Eras ticket costs, if noticed in any respect, didn’t shift that inflation element. There was a marked massive rise within the smaller dwell music element, however that could be a minuscule a part of the general index.
So, no materials inflationary enhance from tickets. What in regards to the pop in resort costs? Is that this the ‘TSwift Lift’ within the UK?
As we talked about final week, the seemingly goal assortment dates for June’s inflation figures had been both the eleventh or 18th of June, with the previous extra possible. The ONS’s launch confirms:
The figures on this publication use knowledge collected on or round 11 June 2024.
And, as additionally talked about final week, the eleventh lands in lifeless zone relative to Eras dates:
As TD Securities’ Lucas Krishan and Pooja Kumra put it in a be aware this morning:
Whereas the shocking energy within the resort element may at first look counsel that Taylor Swift ended up having a bigger influence on costs than anticipated, we’d warning in opposition to this view. The index day for the June report was 11 June, and this didn’t line up with any Taylor Swift concert events.
As Jefferies’ Modupe Adegbembo observes this might simply replicate . . . any method of the opposite issues that happen in June:
Whereas the shocking energy within the resort element may at first look counsel that Taylor Swift ended up having a bigger influence on costs than anticipated, we’d warning in opposition to this view. The index day for the June report was 11 June, and this didn’t line up with any Taylor Swift concert events.
Cool, sorted.
Now, let’s verify the headlines:
Sigh. And, uh, maybe the scenes on the Financial institution of England:
Nonetheless, we love a problem, so let’s see if we are able to discover any stable proof of Swiftflation in these figures.
However first, there’s time to briefly dwell on a higher trigger for concern.
Briefly dwelling on a higher trigger for concern
What’s going on with resort costs? The class retains registering chunky rises, regardless of considerably extra sober alerts from corporations:
Examine and distinction with the phrase from Whitbread, proprietor of Premier Inn, which represents greater than a tenth of the UK housing market and presumably has the pricing energy to replicate that. In a buying and selling replace final month, they stated room costs had been down year-over-year:
Why is the ONS producing such a distinct image to the true world? Let’s have a look at their numbers.
We talked about final week that the ONS doesn’t revealed detailed data on noticed ticket costs. Fortunately, they do achieve this for resort costs, beneath the “Lodge 1 Evening” merchandise.
The stats physique’s brokers noticed 125 particular person resort costs in June, of which solely 56 had been deemed to be legitimate:
So, a pleasant vary from £54 to, umm, £636. (The median of these figures is £140.50, however the ONS strikes in mysterious methods.)
Is that this sufficient knowledge? We’re undecided, but it surely actually doesn’t appear to be a lot, particularly with out taking different indicators under consideration. Both method, bizarre.
UK inflation (Taylor’s model)
Let’s end by returning to Tay Tay.
It may be price dwelling on the variety of invalid costs gathered in June — 68 had been rejected for having a value of zero, which could counsel sold-out motels. That might be Swift-related, however 56 had been rejected for a similar motive in Could so it looks like a little bit of a attain.
Attempting one other path, right here’s the breakdown by area:
Eyeballing our date chart above, it’s actually solely the North West that ought to be related to Swift — she performed Anfield (in Liverpool, within the north west of England, if that wants saying) on June thirteenth, the one date that looks like it might conceivably be described as “on or round” assortment day on the eleventh. If there was any Eras-related value gouging, that’s the place we’d discover it.
As Peter Donaghy points out on X, 34 of the value quotes utilized in June had been for areas that had legitimate value in Could.
Right here, in a recent little bit of chart abuse, is how the Could and June costs evaluate. We’ve mixed the area and store codes for every value to generate distinctive IDs for every resort value vendor, within the course of creating what seems like a bunch of glamorous provincial police reveals.
Put together to scroooooooooooooooooll:
What, if something, can we be taught? Effectively, two motels apparently massively jacked up their costs over the month: Wales 18982, from £133.50 to £369, and North West 5106 from £85.99 to £210.99.
So, boiling it down, maybe Taylor Swift did contribute to UK inflation in June in any case — by presumably prompting one resort, presumably in Liverpool, to presumably value gouge forward of her Anfield look. Stellar stuff, maintain the entrance web page.