Before it got permanently labelled as among the most expensive places to live on the planet, Hong Kong took a dramatic fall in global rankings — from 33rd in 2010 to 45th last year. This is according to a study made by the human resources consultancy ECA International.

The global chart showed Tokyo as the most priciest places to live, followed by Oslo. Soaring inflation didn’t matter much as Hong Kong fell from sixth to seventh in Asia after Tokyo, Nagoya, Yokohama, Kobe and Singapore.

But before we celebrate, bear in mind that the study, aimed at helping multinational companies calculate expatriate salaries, do not include housing costs. It seems odd to leave a vital piece of cost of living indicator but it’s a given that multinationals cover accommodation costs of expats so there is not much to worry when it comes to shelling out personal funds when signing a new apartment lease contract. But, of course, this isn’t applicable to every single foreign worker.

Roles reversed between Hong Kong and Singapore, as the study indicated goods and services costs 3% more in Singapore than Hong Kong in 2011. Hong Kong was 5% more expensive than Singapore the previous year. Part of the changes were brought by a stronger Singaporean dollar, according to Lee Quane, Regional Director, Asia for ECA International. Hong Kong dollar is pegged to the US dollar so a weak greenback also meant relatively weaker Hong Kong currency.

The study compares the price of consumer goods and services commonly used by expatriates and overseas workers, including groceries, electrical goods and meals across 400 locations worldwide. Although the inflation rate in Hong Kong rose more than 7 per cent in the past 12 months, it is still two per cent less than rise in China’s major cities.

This could mean good and bad news for companies with offices in Hong Kong and mainland. While the cost of living in the city eased with respect with its neighbors, it may require higher allowance to send staff across the border. You don’t have to use a company to compare cost difference; housewives in the mainland bothered with milk powder supply shortage visit Hong Kong to buy cheaper stocks.