Iceland becomes the world’s most expensive country, overtaking Switzerland

Iceland has reclaimed the top spot as the most expensive nation, with consumer prices now three percent higher than Switzerland. Analyses by the Icelandic union Vis ka, using Eurostat and the Central Bank’s data, show that costs are 84 % above the EU average, driven largely by a tourism‑led boom, high import taxes, and the island’s geographic isolation.

Food prices are 44 % higher and meat 71 % higher than in neighboring Nordic markets, while housing costs have surged as tourists compete for apartments. Average net salaries of about 540 000 Icelandic króna (≈ €2 500) do not fully offset the rising expenses, leaving many households to share or move to suburbs. The surge in prices is also affecting visitors, with an increasing share questioning the value of their trips.

Economists warn that if inflation remains unchecked, Iceland could see a weakening of the krona and a drop in purchasing power, compounding the affordability challenge for residents and tourists alike.