Iceland beats Switzerland as most expensive country in the world

The calculations are based on data from Eurostat and Iceland's central bank, Sedlabanki.

The last time it was more expensive in Iceland than in Switzerland was in 2018, according to Eurostat.

According to Hilmarsson, a large part of the upward pressure on prices is due to the fact that the Icelandic economy is largely based on tourism, which pushes up service inflation and wages.

High housing prices - including those related to tourism - also contribute.

We are far too dependent on labor-intensive industries that will continue to create inflationary pressures, Hilmarsson says.