Royal fans and tourists give London a much-needed boost amid UK economic woes

Royal fans have poured into the heart of London to experience the flag-lined roads and pomp-filled processions. And, many are braving the long line to pay their respects to Queen Elizabeth II. While there, they're filling the city's hotels, restaurants and shops.

Visitors crowding into central London from as far away as the US and India for the historic moment are giving a boost to businesses at a time when the British economy is facing a cost-of-living crisis fuelled by the highest inflation in four decades and predictions of a looming recession.

“This is the history, you know, this happens once in a lifetime,” said Kanakkantt Benedict, who was visiting from India with his wife and filed past the queen’s flag-draped coffin this week. “So we became a part of it.” The pomp and pageantry leading up to the funeral for Britain's longest-reigning monarch underscored the royal family's power as a global attraction. From an elaborate military procession for her crown-topped coffin drawing live viewers around the world, to piles of flowers filling up Green Park near Buckingham Palace and gift shops hastily churning out souvenirs commemorating the queen's life as people clamour for mementos.

Hundreds of thousands are expected to pay tribute to the queen in the four days that her body lies in state ahead of her funeral on Monday, pushing up demand for hotel rooms in central London that in some cases have doubled in price.

World leaders, including US President Joe Biden and Japan's emperor and empress, plus their entourages, need places to stay as they arrive for the queen's funeral. So do police officers coming from around Britain to help with security.

Occupancy levels could reach an all-time high of 95 per cent, according to London-based booking platform Hotelplanner.com. “That’s not surprising when you consider that the eyes of the world really are on the capital and the media, dignitaries and members of the public, just like myself, who just want to be part of such a historic occasion,” said Thomas Emanuel, senior director of hotel analytics firm STR.

All 35 rooms at Corbigoe Hotel in London's Victoria neighborhood, near Buckingham Palace, were booked, duty manager Riaz Badar said. “Nowadays, rooms are full in this area, not only in our hotel but around all the hotels in this area," Badar said.

On the Thames, the Riverside Cafe that's next to the line of people queuing to get a glimpse of the queen's coffin, has been "extremely busy," manager Zab Istanik said. He's been opening two hours earlier than normal, at 7am.

“We were busy like this when the Queen Mother passed away in 2002. But it wasn’t as busy as it is ... this week,” Istanik said. Also on the route, Jason Rich's food stall, Fed By Plants, was doing brisk business selling lentil burgers. “It’s a long queue," Rich said. “So definitely it had a good boost on the business.”

The UK was already an attractive place to visit as demand rebounds for international travel since the Covid-19 pandemic and the weakened pound, especially for American visitors, makes transatlantic travel more affordable.

University professor Chad Broughton, 51, who was visiting London from Chicago with two friends, said their hotel room in the touristy Covent Garden area was pricey at £400 ($456) a night.

But the trip to London was unique. “Seeing all these people queued up, seeing the reaction on BBC and just feeling this, you get a sense of how important it is to the people here," he said.

Plus, costs were offset by the currency's fall, friend Josh Walsman said. “We’ve found everything to be a pretty surprising value,” Walsman, 51, said as they walked by Westminster Hall.

Walsman said they went to a Champions League football match, had tickets for a play and a dinner reservation at the upscale Cinnamon Club Indian restaurant. “The conversion rate has meant that each time a bill comes, it’s like: ‘Oh, I thought it was about 30 per cent more.'”

The pound briefly slumped to a 37-year low against the dollar on Friday after UK retail sales volumes slid more than expected in August — a fresh sign of economic weakness.

The British economy is reeling from rising energy prices spurred by Russia's war in Ukraine, driving the worst cost-of-living crisis in a generation. The government said it will cap energy bills for households and businesses, but prices are still painfully high. Inflation is the highest in the G7 economies, at nearly 10 per cent.

With that backdrop, the money being spent by visitors offered a glimmer of hope. Budget hotel operator Travelodge said it's ordered extra breakfast supplies for its 78 London hotels for Monday, saying it expects many mourners to start their day with a "traditional full English” breakfast.

Some analysts predicted the overall economic boost for the UK from the royal mourning period would be limited. That's because it would be offset by supermarkets, retailers, hardware stores and other businesses closing for the funeral Monday, which has been made a public holiday.

However, renewed interest in the royal family could give an extended boost to the travel and tourism industry, said Tim Hentschel, co-founder and chief executive of Hotelplanner.com. “Yes, short term, the bank holiday will probably cut down productivity a little bit," Hentschel said. However, he cited the "overall momentum" that tourism will bring will "far outweigh" the short-term loss.