The cities of Querétaro and Aguascalientes were the biggest movers up the rankings in the “Worldwide Cost of Living 2023” survey, conducted by The Economist Intelligence Unit (EIU).
Published Thursday, the survey report shows that Santiago de Querétaro, as Querétaro city is officially known, ascended 48 places to become the 51st most expensive city out of 173 cities assessed by the EIU, the research and analysis division of the London-based The Economist Group.
Aguascalientes, capital of the state of the same name, rose 39 positions in the rankings to become the 82nd most expensive city.
“Three Latin American cities – Santiago de Querétaro, Aguascalientes and San José (Costa Rica) – are the three biggest upward movers,” the EIU said.
“Central banks in much of Latin America were among the first to follow the U.S. Federal Reserve’s interest-rate rises, in order to support their currencies. As a result, the Mexican peso and the Costa Rican colón had both appreciated against the US dollar at the time of our survey,” it said.
“[Consumer] prices have also been buoyed by strong inward investment, particularly in Mexico.”
The EIU conducted its survey between Aug. 14 and Sept. 11, a period during which the USD:MXN exchange rate fluctuated between a low of around 16.7 and a high of about 17.6.
The peso has appreciated considerably this year after trading at about 19.5 to the greenback at the start of 2023. The USD:MXN exchange rate was about 17.3 shortly after 8 a.m. Friday.
The strength of the peso had a significant bearing on the rise of Querétaro and Aguascalientes up the rankings as EIU economists convert the price data collected in the 173 evaluated cities into US dollar terms, “using the prevailing exchange rate and weighting to achieve comparative indices,” according to the survey report.
“To collect the data, each researcher has a list of more than 200 specified products and services to research, with more than 50,000 individual prices collected every six months,” the unit said.
“These include prices for food, drink, clothing, household supplies and personal care items, home rents, transport, utility bills, private schools, domestic help and recreational costs.”
As anyone living in Mexico, but earning in dollars knows, life here has become more expensive. Consumer prices have also spiked due to inflation, although Mexico’s headline rate now – 4.32% in the first half of November – is much lower than the 7.91% rate recorded in January.
Querétaro’s score on the EIU index – on which New York is the reference city and thus has a score of 100 – was 71, making it similarly expensive to cities such as Rome, Miami, Atlanta, Abu Dhabi and Brisbane. It was the second most expensive city in Latin America among 18 assessed.
Aguascalientes’ score was 64, putting it on or near a par with cities such as Rotterdam, Prague, Montreal, Dubai, Hanoi and Wuhan.
The only other Mexican city where expenses were evaluated was Mexico City, which was determined to be the most expensive city in Latin America. Its cost of living index score was 81, making the Mexican capital similarly expensive to cities such as Helsinki, Reykjavik, Seattle, Houston and Sydney.
Zurich and Singapore – which both had a cost of living score of 104 – tied in first place, sharing the honor (or dishonor) of being the most expensive city out of the 173 evaluated by the EIU.
Ranking third to 10th were Geneva, New York, Hong Kong, Los Angeles, Paris, Copenhagen, Tel Aviv and San Francisco.
The EIU said that “many cities across the world continue to struggle with a cost-of-living crisis, which has sent prices soaring over the past two years.”
It determined that the least expensive city in 2023 was Damascus, followed by Tehran, Tripoli, Karachi, Tashkent, Tunis, Lusaka, Ahmedabad, Lagos, Chennai and Bueno Aires.
Mexico News Daily