The effects of the financial crisis and the depreciation of the Icelandic krona have been felt in many different ways – among them that Reykjavik is now ranked as one of the cheapest cities in Western Europe (for people other than Icelandic residents, of course).
British magazine The Economist conducts a yearly survey of how much it costs for non-locals to live in various cities around the world. There is usually little change to the rankings year-on-year, but the financial upheaval and consequent currency fluctuations which have engulfed the world over recent months have conspired to turn the list on its head.
Of the 132 cities around the world which The Economist includes in its survey, Reykjavik is now ranked in 67th place – down from fifth a year ago. Only one surveyed city in Western Europe is considered cheaper, and that is Manchester.
Because of the heavy fall in value of the British pound against the euro, British cities have uniformly dropped down the list. London was, for example, the 8th most expensive city last year but has since fallen to 27th.
The value of the Japanese yen has held up on the other hand, meaning that two Japanese cities now head the top of the list: Tokyo and Osaka.
Oslo was last year’s most expensive place to live; but has since slipped to 5th, behind both Paris and Copenhagen.
Most of the cheapest cities are in Asia, including the cheapest of all on the list: Karachi in Pakistan.