Sydney, Melbourne in Top 10 List of Most Expensive Cities to Live in

Australian cities are some of the most expensive places in the world, according to the latest Economist Intelligence Unit's (EIU) Worldwide Cost of Living 2012 report. The roster, released on Wednesday, ranked Sydney as the 7^th and Melbourne the 8 ^th most expensive global cities.

With the rankings, Australia is one of the three countries with two cities each on the list. The other two are Switzerland and Japan. Switzerland's Zurich was number 1 and Geneva number 3. Japan's Tokyo was number 2 and Osaka-Kobe number 4.

Three other cities are in Europe: 5^th placer Oslo in Norway, 6^th placer Paris in France and 10^th placer Frankfurt in Germany. On 9^th place is Singapore.

The EIU explains the prominence of the two Australian cities in the list to the strength of the Australian dollar, stronger than local inflation.

The basis of the EIU in coming up with the list of a comparison of over 400 individual prices across 160 products and services in 130 global cities.

Due to the strong Australian currency, the price of bread in Sydney in the past 12 months rose by almost $1 in Sydney, while white rice prices went up 61 cents in Sydney and 85 cents in Melbourne.

When compared to New York, the cost of living in Sydney is 50 per cent higher than in the Big Apple. Sydney, while it actually went down by one place from 2011, was 25 per cent cheaper to live in compared to New York a decade ago.

Three other Australian cities - Adelaide, Brisbane and Perth - are in the top 20 list with cost of living more expensive than in other global cities such as London, Hong Kong and Rome. Perth is 12^th, Brisbane 13^th and Adelaide 17^th.

The three Australian cities went up the list, Perth by one place, Brisbane by two places and Adelaide by seven places. The inclusion of five Australian cities in the top 20 confirms the frequent complaint of Aussies of soaring prices of goods from energy to basic commodities such as fruit and vegetables, although a current price war between Coles and Woolsworth has somewhat reduced the price of selected fresh produce.

The national capital city, Canberra, also moved up to 34^th place from 47^th place.

Paul Bloxham, chief economist of HSBC, also attributed the rise in prices in Australian cities to two decades of economic growth, which he also described as the cost of success.

On the extreme end, the least expensive city was Muscat in Oman. The lower end of the list was dominated by cities in Asia and Middle East such as Karachi in Pakistan.