New York and Singapore topped the list of the world's most expensive cities in 2022

Sydney slipped into the Top 10 as rising energy prices sent inflation soaring globally, according to an Economist Intelligence Unit survey

New York is the world's most expensive metropolis in 2022, sharing an unwanted title with Singapore, as soaring energy prices double the inflation rate in major global cities, according to the Economist Intelligence Unit's annual survey.

Last year's leader Tel Aviv dropped to third, while Sydney slipped into the Top 10 and Russia's Moscow and St Petersberg upped the rankings by 88 places as sanctions and soaring oil prices pushed prices higher, according to the EIU's Worldwide Cost of Living report. 

Venezuela's capital, Caracas, with prices rising by 132% in 2022, is well down from 2019's hyperinflation rate of over 25,000%, but remains too high to include in the survey. The average inflation of 8.1% in local currency is still the highest in more than two decades of surveys, and up from 3.5% last year and 1.9% in 2020.

A stronger currency is also one of the factors pushing the city up the rankings. Six of the eight highest climbers (after two Russian cities) were US cities, led by Atlanta from 42nd to 46th in a ranking of 172 cities surveyed. The US currency has strengthened sharply against almost all currencies as the US Federal Reserve raised interest rates and hinted at more hikes to come.

Cities in countries where their currencies have slumped were among those that fell on the list of most expensive cities. Japan's Tokyo and Osaka were among the 10 biggest losers, ending at 37th and 43rd respectively, down from 13th and 10th in 2021.

Stockholm and Luxembourg fell the most, both losing 38 places to 99th and 104th. Damascus in Syria and Tripoli in Libya retained their slots as the cheapest city surveyed.

Placing Singapore at the top of the index is no small surprise. The city-state is the second most expensive city in 2021 and has become No. 1. 1 in eight of the last 10 years. This year is the first time the Big Apple has been ranked No. 1.

The three UK cities surveyed all dropped in the rankings, with London now 28th from 17th in 2021. Edinburgh is 46th, down from 27th, while Manchester is 3rd. 73rd most expensive compared to 41st last year.

Australian cities' rankings have edged up in general, with the port city rising from 14th last year to 10th in 2022. Melbourne has risen to 15th from 16th last year, while Brisbane has risen to 32nd from 36th. Perth bucked the trend. , dropping two spots to 73rd.

The surge in global inflation had accelerated before Russia's invasion of Ukraine in February caused supply disruptions to key commodities, especially food. Subsequent sanctions against Russia prompted further spikes in the prices of oil, gas and other energy.

Rising gasoline prices provided the single biggest propellant for higher inflation. On average, a liter of fuel is 22% more expensive in local currency than the previous year.

Gas and electricity prices were 29% higher in western European cities, or nearly three times the average 11% increase globally, as the region struggled to find alternatives to Russian energy.

The consolation for some of the increases came in the rising prices of “weak” recreational goods and services. “[T]hey may reflect weaker demand as consumers focus spending on essentials,” the EIU said.

Less than a few unforeseen disasters, the EIU predicts rising costs will lessen in 2023 as higher interest rates remove some of the demand pressure and supply chain blockages begin to ease. China may remain a replacement card as its zero-Covid policy starts to fall apart.

The good news is that prices may start to decrease in some countries as interest rates rise.

"Unless the war in Ukraine escalates, we predict that commodity prices for energy, food and supplies such as metals are likely to fall sharply in 2023 compared to 2022 levels, although they are likely to remain higher than previous levels," the report said. . Global commodity prices will increase by another 6.5% in 2023, but the pace will slow down from the 9.4% recorded in 2022.

Posting Komentar

Lebih baru Lebih lama

Formulir Kontak