London 'second most costly city'

Transport is very expensive in London, the survey said

London is the second most expensive city in the world to live in, according to a survey of 144 cities.

High accommodation and transport costs, as well as appreciation of the pound against the US dollar, pushed it from seventh to second in a year.

It cost more to travel by underground, buy a CD or a cup of coffee than in most other cities surveyed.

Tokyo retained its title of most expensive in Mercer Human Resource Consulting's survey.

It said it would set you back £1,950 a month in London to rent a luxury two-bedroom unfurnished apartment, compared with £840 in Dublin, £1,311 in Paris and £908 in Rome.

Moscow came in at third place, with Osaka, Japan fourth and Hong Kong fifth.

MOST EXPENSIVE CITIES Tokyo London Moscow Osaka Hong Kong Source: Mercer

Glasgow and Birmingham were ranked at 41 and 51.

Dublin was said to be the 14th most expensive city.

Some of the cheapest European cities were in countries which joined the European Union last month.

"We are likely to see cities in the new EU accession countries rise in the rankings as more investment is made in commercial development, and standards of living increase," said a senior researcher at Mercer, Marie-Laurence Sepede.

The survey, which is used primarily by multinational companies to determine pay for expatriate employees, recorded the cost of 250 items, including utilities, food and entertainment.