Tokyo drift

By Economist.com

The cost of living around the world

TOKYO has reclaimed its place as the world's most expensive city, according to the latest cost of living index from our sister company, the Economist Intelligence Unit. The Japanese city has ranked first 14 times in the last 20 years; only Zurich (which was first last year thanks to its strong currency), Paris and Oslo have also placed first in this period. The index is a weighted average of the prices of 160 products and services, with New York's figure set to 100 to provide a base for comparisons. New York itself has become more expensive; it now ranks 27th out of 131 cities, up 19 places from a year ago. Geneva and Zurich have seen the biggest falls in the last year, as Switzerland made efforts to weaken its franc. In the last decade the cost of living has declined most in Detroit and Panama City, and increased most in Caracas and São Paulo. Venezuela's bolívar is pegged to the dollar, which explains why Caracas is one of the ten priciest cities. But using an unofficial exchange rate, which is weaker and takes into account the country's high inflation, places Caracas on a par with Mumbai and Karachi.