MANILA - Paris, Zurich and Hong Kong overtook Singapore and Osaka in Japan as the world's most expensive cities this year, according to The Economist's Worldwide Cost of Living report.

The previous two frontrunners fell to fourth and fifth place "due to deflationary pressures as a result of shrinking domestic demand and government action," the report read.

Prices fell in Singapore as the COVID-19 pandemic led to an exodus of foreign workers resulting in a decline in demand, The Economist said. Osaka saw a similar trend, with "consumer prices stagnating and the Japanese government subsidizing costs such as public transport," it added.

The prices of essential goods proved "more resilient" than those deemed non-essential, according to the study.

"However, this translates to prices for staples, such as coffee, cheese, rice and orange juice, remaining flat, rather than increasing," it read.

The study also found prices for consumer electronics surged, with the cost of a personal computer rising by 18.7 points on average, while clothing prices declined.

"Although much will depend on the course of the pandemic, we expect many of the above price trends to continue into 2021. With the global economy unlikely to return to pre-pandemic levels until 2022, spending will remain restricted and put prices under downward pressure," said Upasana Dutt, head of Worldwide Cost of Living at The Economist Intelligence Unit.

"Many price-conscious consumers will prioritize spending on staples, home entertainment and faster internet access. Big-ticket items, as well as clothing and out-of-home recreation, will continue to struggle."

The following are the most expensive cities to live in, according to the report:

• Zurich, Switzerland
• Paris, France
• Hong Kong, SAR
• Singapore, Singapore
• Tel Aviv, Israel
• Osaka, Japan
• Geneva, Switzerland
• New York, United States
• Copenhagen, Denmark
• Los Angeles, United States

The Economist said its researchers gather price data from a range of stores and service producers and then convert these into US dollars using the prevailing exchange rate and weighting.

All cities are compared with a base city, New York, which has an index score of 100.

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