Story at a glance
- The Economic Intelligence Unit (EIC) published its Worldwide Cost of Living 2021 report, which included the top 10 most expensive cities to live in.
- Tel Aviv, Israel was considered the most expensive city to live in.
- EIC found most U.S. cities have fallen in the rankings compared with last year, after the government responded to the pandemic by injecting more money into the economy.
A new ranking of the world’s most expensive cities is out, and the Economic Intelligence Unit (EIU) says inflation, supply chain problems and pandemic restrictions all influenced how cities fared.
EIU published its Worldwide Cost of Living 2021 report and compiled a top 10 list of cities that were considered the most expensive. Tel Aviv, Israel was No. 1 for the very first time. The city experienced a soaring currency; the shekel appreciated in value making local costs more expensive when converting to U.S. dollars
1. Tel Aviv
The city saw an increase in groceries and transportation, while also seeing a rise in property costs in residential areas. According to EIU, compared with other cities, Tel Aviv is a notably expensive place to buy alcohol (second in that category), transport (also second), personal care items (fifth) and recreation (sixth).
2 & 3. Paris and Singapore
The two cities tied for second this year. Paris previously held the No. 1 spot, but was overtaken this year by Tel Aviv. Singapore is considered an island-city state in southeast Asia and only consists of 275 square miles.
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4. Zurich, Switzerland
It’s the second Swiss city to top EIC’s 2021 cost living report. Zurich, located in northern Switzerland, is known as a global hub for banking and finance.
5. Hong Kong, China
Considered the Hong Kong Special Administrative Region within the People’s Republic of China, Hong Kong is one of only two Asian cities to make it to this year’s top 10 list.
6. New York City
The largest city in the U.S., New York City managed to land as the fifth most expensive city in the world. EIC also uses New York City as a benchmark for its price index.
Interestingly, EIC found that most U.S. cities have fallen in the rankings compared with last year, after the government responded to the pandemic by injecting more money into the economy. This held down the value of the US dollar compared with European and Asian currencies.
7. Geneva, Switzerland
The second Swiss city to land on this year’s list, Geneva serves as the European headquarters for the United Nations along with the International Committee of The Red Cross.
8. Copenhagen, Denmark
The capital of Denmark, Copenhagen is also the country’s largest city.
9. Los Angeles
The second largest city in the U.S., Los Angeles is home to Hollywood, one of the world’s biggest entertainment hubs.
10. Osaka, Japan
The only Japanese city on EIC’s list, Osaka is known for its vibrant nightlife and cherry blossom trees.
Over the coming year, EIC expects to see the cost of living rise further in many cities. Inflation is also expected to continue, which may feed into wage increases and raise prices for goods across the board. EIC forecasts that global consumer price inflation will average 4.3 percent in 2022, which is down from 5.1 percent in 2021.
However, if supply chain disruptions are solved and pandemic-related lockdowns are eased around the world, inflation is likely to improve towards the end of 2022, which may help stabilize the cost of living in most major cities.
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