Montevideo is the Most Expensive City in South America

Montevideo is the most expensive city to live in across South America, according to Mercer’s Cost of Living City Ranking for 2024.

The Uruguayan capital is closely followed by Buenos Aires, which continues to grapple with severe currency fluctuations and persistent inflation.

Mercer’s annual index considers over 200 essential factors affecting the quality of life for international workers and expatriates, encompassing categories like housing, transportation, food, clothing, household goods and entertainment.

A notable shift was observed in Chilean capital of Santiago. The city dropped to 160th place globally and sixth within the region. The decrease in living costs in Santiago can be attributed to a decreased demand for housing, resulting in more accessible rental properties. However, costs have risen in other Chilean cities.

São Paulo surged 28 positions globally to maintain its status as Brazil’s most expensive city. Mercer’s survey highlighted other Brazilian cities such as Rio de Janeiro (150th), Brasilia (179th), Manaus (182nd) and Belo Horizonte (185th), all contributing to Brazil’s representation in the index.

Lima (Peru) moved up slightly to 166th place, while Bogota (Colombia) ranked 174th. In Mexico, Mexico City climbed to 33rd place from 79th in a single year, with Monterrey following at 115th after a marked improvement from its 2023 ranking of 155th.

Nassau, in The Bahamas, maintained its position as the most expensive city in the Americas, surpassing even Mexico City.

Inflation trends keep impacting purchasing power and placing additional pressure on salary adjustments worldwide. This situation poses challenges for employers aiming to attract and retain skilled talent.

To effectively manage these challenges and retain talent, Mercer emphasized the importance for organizations to stay informed about cost of living trends and inflation rates.