Zurich and Singapore have emerged as the most expensive cities in the world, surpassing New York, according to the latest rankings published by The Economist magazine. This comes as no surprise given the ever-rising cost of living globally.
The study, conducted by Upasana Dutt and her team, estimated that prices in 173 major cities have increased by an average of 7.4 percent over the past year. While this represents a slight slowdown compared to the record-breaking 8.1 percent inflation in 2022, it is clear that the cost of living crisis is far from over. Price levels remain significantly higher than historic trends.
According to the study, the rankings are based on the prices of 200 products and services. The researchers expect inflation to decelerate further in 2024, thanks to the efforts of central banks in combating price increases through interest rate hikes.
Zurich, the financial hub of Switzerland, has dethroned New York, which held the top spot in the rankings last year alongside Singapore. The shift in rankings can be attributed to the continued high inflation affecting food and clothing in Europe, as well as the appreciation of the euro against the dollar. Geneva, another Swiss city, tied with New York in third place.
Asia also features prominently in the list, with Hong Kong securing the fourth spot and Singapore coming in second. The high cost of living in these cities can be attributed to various factors, including limited land availability, high demand for housing, and high wages.
Paris, the capital of France, secured the seventh position in the rankings. Despite being known for its cultural heritage and charm, the city’s high cost of living can be attributed to factors such as rising rents and the appreciation of the euro against the dollar.
Other European cities that made it to the top 10 include Copenhagen and Tel Aviv, which tied for eighth place. These cities have also experienced high inflation, leading to increased prices for goods and services.
It is worth noting that the rankings are based on the prices converted to US dollars. This conversion often results in higher prices in the eurozone, particularly when the euro strengthens against the dollar. This further contributes to the high cost of living in European cities.
On the other end of the spectrum, the ranking also highlights the cheapest cities in the world. Damascus, the capital of Syria, takes the top spot as the least expensive city, followed by Tehran, the capital of Iran.
Interestingly, the rankings also reflect the impact of geopolitical events on the cost of living. Russian cities, such as Moscow and Saint Petersburg, experienced significant drops in their rankings. This can be attributed to the weakening ruble, which is a result of hefty sanctions imposed in response to Russia’s war in Ukraine.
In conclusion, Zurich and Singapore’s rise to the top of the list of the most expensive cities in the world is a reflection of the ongoing cost of living crisis. Factors such as high inflation, currency fluctuations, and economic conditions all contribute to the high prices in these cities. As we move forward, it will be interesting to see how these rankings evolve and whether measures will be taken to address the affordability challenges faced by residents in these cities.
Source: The Manila Times
