The relentless global cost-of-living crisis, originating in 2022, has become an integral part of daily life, even finding its way into the vernacular with terms like "Cozzie livs." Recently crowned Australia's word of the year, this crisis continues to impact economies worldwide. The latest Worldwide Cost of Living survey by EIU, our sister company, sheds light on the ongoing challenges, revealing that inflation remains high globally. With a 7.4% average increase in the prices of 200 tracked products and services over the past year, the crisis persists, though slightly down from 2022's 8.1%. Our map and chart unveil the most expensive cities, providing insights into the evolving landscape of the cost-of-living crisis.
Expensive Cities and Ties at the Top:
Tied for first place in this year's rankings are Singapore and Zurich. Singapore, a familiar occupant of the top spot, continues its streak, having been the priciest place to live in nine of the past 11 years. The city-state's high costs extend to groceries, alcohol, and clothing, with notable examples like the staggering cost of a car ownership certificate. Zurich's ascent to joint first place is attributed to the Swiss franc's appreciation against the dollar, rising more than 10% over the past year.
European Influence and Shifting Dynamics:
Western European cities, including Copenhagen, Dublin, and Vienna, claim a significant presence in the top 20, driven by rising prices and the European Central Bank's efforts to curb inflation. However, North American cities experienced a drop in rankings, with New York falling to third place from last year's joint most-expensive city with Singapore.
Global Shifts and Climbers/Droppers:
The standout climbers this year include Santiago de Querétaro and Aguascalientes in Mexico, along with San José, Costa Rica. On the flip side, several Chinese cities, including Beijing, witnessed significant declines, reflecting the depreciation of the renminbi and challenges in China's post-pandemic recovery. Moscow and St Petersburg saw the steepest falls, attributed to the rouble's collapse amid Western sanctions on Russian oil and increased military spending.
Future Concerns and Pessimistic Outlook:
The report concludes on a pessimistic note for the coming year. Unlikely to see a reduction soon, interest rates are expected to constrain economic growth. Potential rises in energy prices due to geopolitical conflicts, such as the Israel-Hamas war, and the lingering impact of El Niño on food prices contribute to a challenging outlook. The coined term "Cozzie livs" is predicted to remain a prominent feature well into 2024.
As the cost-of-living crisis persists globally, the rankings offer valuable insights into the cities grappling with the highest living expenses. Understanding these dynamics becomes crucial for individuals, businesses, and policymakers navigating the complex landscape shaped by economic shifts, geopolitical events, and regional influences.
