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Hong Kong is cheaper for expats

Hong Kong has tumbled down the ladder of the world's most expensive cities for expatriates, a global survey has found.

And mainland cities have also become more affordable in the past year as the US dollar dropped and western goods became cheaper.

Hong Kong was ranked the 20th most expensive city in the world by the Economist Intelligence Unit this year, down from 12th in spring last year, while Shanghai, the most expensive mainland city, fell to 55th place.

The editor of the survey, Jon Copestake, said the drop seen in mainland cities was unique because the mainland was experiencing inflationary pressure as the economy boomed.

'But while the price of rice might be going up, something like a can of tinned peaches has actually fallen in price as the country continues to open up,' he said.

Mr Copestake said although the yuan was no longer pegged to the US dollar, prices on the mainland were likely to continue to fall.

While Tokyo remains the world's most expensive city, Oslo overtook Osaka to move into second place. The survey compares the cost of a basket of supermarket goods to help firms work out their expatriate allowances.