Tokyo was ranked as the world’s most expensive city for expatriates in Mercer’s 2012 Worldwide Cost of Living Survey. Last year’s top city—Luanda, Angola—came in second. Mercer’s survey, used by employers to determine compensation allowances for expatriate employees, measures the cost of more than 200 items in 214 cities. Housing, often the biggest expense for expats, played an important part in the ranking, as did currency fluctuations. Overall, European cities experienced a decline in cost of living; North American cities rose as the U.S. dollar strengthened against many currencies; and all surveyed cities in Australia, China, Japan, and New Zealand moved up in the rankings, according to Mercer.
Data source on all slides: Mercer Worldwide Cost of Living Survey 2012