The worldwide cost of living issue is far from ended, which is news that won’t surprise anyone who has been struggling financially. And residents of large cities may suffer greatly.
The Economist Intelligence Unit (EIU) reports an annual Worldwide Cost of Living Index that shows this year’s average cost of living increased by 7.4%. The prices of groceries rose the quickest.
This represents a tiny decrease from the 8.1% increase that the same poll found in 2022, but the numbers are still much higher than “historic trends.”
However, there is positive news. This time around, there was the least level of inflation seen in utility prices, which rose at the quickest rate in the 2022 study.
Forecasts of inflation
Since China removed the Covid-19 limits in late 2022, supply chain lifted have subsided, which has caused price rises to slow down.
Nonetheless, grocery costs are still rising as a result of businesses charging customers more for their goods.
According to a statement by Upasana Dutt, Head of Worldwide Cost of Living at EIU, “We expect inflation to continue to decelerate in 2024, as the lagged impact of interest-rate rises starts affecting economic activity, and in turn, consumer demand.”
Dutt continued by warning that harsh weather and violent conflict still pose risks.
“Further escalations of the Israel-Hamas war would drive up energy prices, while a greater than expected impact from El Niño would push up food prices even further,” she continued.
Living costs have naturally increased the cost of living in many places; however, certain cities have been struck more severely than others.
The most expensive cities
The world’s most costly cities were found to be Singapore, a city-state, and Zurich, a city in Switzerland.
The strength of the Swiss Franc combined with the high cost of groceries, household items, and leisure activities was blamed for the latter’s ascent, which saw it jump from sixth position on the list from the previous year. The pricey apparel and transportation in Singapore were also mentioned.
While New York and Singapore shared first place last year, the well-liked US destination spot—whose costs have climbed by 1.9%, per the study—dropped to third place, drawing a tie with Geneva, Switzerland.
Los Angeles ranked sixth, Paris was ranked seventh, and Hong Kong, the only other Asian destination in the top 10, came in at number five.
Israel’s Tel Aviv and Denmark’s Copenhagen are tied for seventh position. It’s important to remember, though, that the survey was carried out before to the Israel-Hamas conflict that broke out in October.
San Francisco, one of the three American cities in the top 10, was ranked 10th overall.
Shakers and Movers
Moscow and St. Petersburg, two Russian cities farther down the list, experienced some of the biggest declines, dropping 105 spots to 142 and 74 places to 147 in this year’s rating, respectively. Since Russia invaded Ukraine in February 2022, the value of the ruble has significantly decreased.
According to the report, “subdued consumer demand” and the tardy post-pandemic recovery were two of the factors that caused Chinese cities like Beijing, which placed 34 last year, to fall many spots on the list.
The cheapest city in the world is still Damascus, Syria. Tripoli, Libya, and Tehran, Iran, rank 171st and 172nd, respectively, and are both quite near the bottom.
US cities had the greatest expenses for utilities, domestic help, and tobacco, while Western European cities had some of the highest expenditures for transportation, recreation, and household goods.
The survey found that the most expensive goods in Asian cities were groceries and alcohol.
The 2023 Worldwide Cost of Living study examined 173 major locations and compared over 400 prices for 200 different goods and services. It did not include Caracas, Venezuela, where prices have increased by 450% since 2022.
The 10 most expensive cities in the world in 2023 –
- Zurich and Singapore (tie)
- New York and Geneva (tie)
- Hong Kong
- Los Angeles
- Paris
- Tel Aviv and Copenhagen (tie)
- San Francisco
