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Sydney named seventh most expensive city to live in

Thanks to the strength of the Australian dollar, Sydney has been named the seventh most expensive city in the world to live in, closely followed by Melbourne, which took out the eighth spot

Sydney slipped a place in the rankings, moving from number six in 2010 to seventh in 2012. Melbourne’s rank hasn’t changed over the past year though, holding steady as the eight most expensive city to live in.

According to the Economist Intelligence Unit’s Worldwide Cost of Living 2012 report, the strength of the Australian dollar is to blame for two of our cities’ presence in the list, with local inflation having significantly less impact on the relative cost of living than currency movements.

The Economist Intelligence Unit’s bi-annual report compares more than 400 individual prices across 160 products and services and is designed to to calculate cost-of-living allowances and build compensation packages for expatriates and business travellers.

In Sydney, the price of bread has jumped by almost a dollar in just the past year and fallen by $1.23 in Melbourne. White rice prices have jumped 0.61 cents in Sydney and 0.85 cents in Melbourne.

According to the report, Zurich is now the world’s most expensive city to live in, with Tokyo coming in second, Geneva third and Osaka fourth, thanks to strong currency movements in Switzerland and Japan over the past 12 months.

Currency movements have been especially strong in Switzerland, as investors seek out a currency untouched by trouble in the Eurozone and invest heavily in the Swiss Franc.

Oslo came in fifth, Paris in sixth, Singapore ranked ninth and Frankfurt rounded out the top ten.

The list of the cheapest cities was dominated by Asian and Middle Eastern cities, with Karachi found to be the least expensive city in the world.