Moscow coffee had better be good!

Over £5 for a standard cup of coffee would stagger most of us but it has become the norm for expats living in Moscow - officially the world’s most expensive city and a fact already well known to the thousands of Manchester United and Chelsea fans who travelled to the Champion’s League final last May.

The Mercer Cost of Living index is perhaps a useful snippet of information to use when teaching about living standards and purchasing power parity adjustments. Their latest survey is produced today and finds that Moscow retains top spot as the most expensive city in the world for expatriates. Mercer’s survey covers 143 cities across six continents and measures the comparative cost of over 200 items in each location, including housing, transport, food, clothing, household goods and entertainment.

“The survey found that one cup of coffee including service would cost on average £2.20 in London, compared with £5.19 in Moscow and £2.57 in Tokyo”

The huge rise in accommodation costs in the capital allied to an appreciation of the rouble against the US dollar has seen the city stretch further away as the most costly place to live and work. Exchange rate movements account for many of the changes in rankings - for example the depreciation of the US dollar against the Euro. But differences in economic growth which have contibuted in some case to cost of living inflation rates in excess of 10 per cent have also had an impact. Other cities in eastern Europe and the BRIC nations are rising up the list. Prague (the city of choice for my Euro railing lower sixth form students this summer) has jumped from 49th to 29th. The only North American city to feature in this year’s top 50 is New York in 22nd place. Asunción, in Paraguay is the least expensive of the 143 cities covered.

Reports on this data from the BBC, the Times and the Financial Times

The top ten most expensive cities were:
Moscow
Tokyo
London
Oslo
Seoul
Hong Kong
Copenhagen
Geneva
Zurich
Milan