New York and Singapore are tied first as the world’s most expensive cities, according to the Economist Intelligence Unit (EUI).
Data released today by EIU show the increased cost of living in the world’s biggest cities. On average, according to the index, prices across the 172 cities covered by the EIU’s Worldwide Cost of Living (WCOL) index rose by 8.1% in local-currency terms. This is the highest rate in the 20 years since the index started.
This year’s survey was conducted between August 16th and September 16th 2022.
The WCOL index also shows the impact of the strong US dollar on city rankings as interest rates rise and investors opt for safety. New York topped the rankings for the first time, tying with Singapore.
Last year’s leader, Tel Aviv, fell into third place, while Damascus and Tripoli remain the cheapest cities.
The biggest upward movers were Moscow and St Petersburg, which rose by 88 and 70 places respectively as prices soared amid Western sanctions against Russia and buoyant energy markets.
Most other European cities fell down the rankings due to the energy crisis and the weakening euro and other local currencies. Stockholm, Luxembourg and Lyon were the biggest fallers.
However, many prices still rose rapidly in the region. Prices for gas and electricity were up by 29% on average in local-currency terms in western European cities as the region tries to rid itself of Russian energy. This compares with a global average increase of 11%.
Globally, the most rapid price rises were for petrol (as in 2021), which soared by 22% in local-currency terms. Prices for utilities such as electricity, as well as food and basic household goods, also rose rapidly. By contrast, prices for recreational goods and services were subdued; this may reflect softer demand as consumers focus spending on essentials.
“The war in Ukraine, Western sanctions on Russia and China’s zero-covid policies have caused supply-chain problems that, combined with rising interest rates and exchange-rate shifts, have resulted in a cost-of-living crisis across the world. We can clearly see the impact in this year’s index, with the average price rise across the 172 cities in our survey being the strongest we’ve seen in the 20 years for which we have digital data. We expect prices to start easing over the coming year as supply bottle-necks start to ease and slowing economies weigh on consumer demand,” commented Upasana Dutt, head of Worldwide Cost of Living at the Economist Intelligence Unit.