Consulting firm Mercer said in its annual Worldwide Cost of Living survey that a weaker dollar and high real estate costs were to blame for Moscow's rank.
"Moscow's position ... has been strengthened by the appreciation of the ruble against the dollar and the continuous rising accommodation costs," Yvonne Traber, a research manager at Mercer, said in a statement.
In the past year, "prices have risen by 22 percent for elite-class housing and 50 percent for business-class housing," said Yekaterina Thain, director of residential real estate for Knight Frank.
Tokyo jumped from fourth last year to the No. 2 spot, nudging London down to third, the report said. Oslo, in fourth, and Seoul rounded out the top five. St. Petersburg was 18th.
The survey examined 143 cities on six continents and compared the cost of more than 200 goods commonly purchased by expatriates.
Moscow has been pulling ahead of its nearest competitors, the survey said. Asuncion, the capital of Paraguay, finished last for the sixth year running.
"Keeping on top of the changes in expatriate cost of living is essential so companies can ensure their employees are compensated fairly and at competitive rates when stationed abroad," Traber said.
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