Tokyo Most Expensive City, Karachi The Cheapest

Tokyo has regained the dubious honour of being the world’s most expensive city, where a cup of coffee will set you back 5.25 pounds, a newspaper 4 pounds and a litre of milk 2 pounds. The Japanese capital topped the annual cost-of-living survey by HR consultants Mercer, which ranks cities according to the needs of expatriates. Luanda, in Angola, where more than half the population of 5 million lives in poverty and where the foreign office advises visitors not to venture out at night, was the second most expensive.

British cities have fallen down the list in recent years, reflecting the weakness of sterling against the US dollar. London was the 25th most expensive city, said Mercer.

The cheapest city was Karachi where the cost of living was a third of that in Tokyo, closely followed by Islamabad.

Some US cities are also remarkably cheap: Winston Salem, in north Carolina, was said by Mercer to have the lowest cost of living of any major urban area in the US; Chicago was ranked a lowly 110th overall and Washington DC 107th.