Melbourne Tops List as Most Expensive City for Cigarettes and Beer

Deutsche Bank's 'Oasis index' is an annual metric that tracks the cost of five beers and two packets of cigarettes in US dollars, city by city. In its latest report, Melbourne topped the list with a basket costing $111.20 (about A$160), followed closely by Sydney at $109.50 (A$157). New York came in last with a basket costing $54.10 (about A$78).

The Oasis index may seem like a novelty metric, but it can provide valuable economic insights into the effects of 'sin taxes' and currency changes. By singling out heavily taxed items like cigarettes and alcohol, the index helps identify trends that might be missed by more general metrics like the Consumer Price Index (CPI).

Other economists have developed similar 'novelty' metrics to track inflation and economic trends. The hemline index, for example, assumes that skirt lengths rise and fall with the stock market's performance.