"But cities like Melbourne and Sydney now appear to have cemented their position among the most expensive across Europe and Asia."
Brisbane and Perth ranked joint 21st in the index, while Adelaide was in 37th place.
Inflation and currency appreciation in neighbouring New Zealand meant Auckland (17th) and Wellington (19th) are more expensive than most Australian cities.
Paris rose six places to become the world's second most expensive city, followed by Oslo, Zurich, and Sydney.
Equalling Melbourne in sixth position were Caracas, Geneva, and Tokyo, followed by Copenhagen in 10th position.
The report says that, while Asian and Australian locations now make up half of the 10 most expensive cities, Asia is also home to many of the world's cheapest cities.
Mumbai is the cheapest city in the index, followed by Karachi and New Delhi. A civil war and the collapse of the Syrian pound places Damascus as the world's fourth cheapest city.
The bi-annual index tracks the price of a virtual basket of goods and services in 131 cities around the world.
More than 400 individual prices are collated, including that of food, drink, clothing, household supplies and personal care items, home rents, transport, utility bills, schooling and recreational costs. The index does not take into account the price of real estate or income taxes.
The baseline of the index is New York, which has a score of 100.
Some of the basic prices compared in each of the cities is the cost of one kilogram of bread, a bottle of wine and a litre of unleaded petrol.
The index says that in Sydney the average price for a litre of unleaded petrol is currently $US1.35 ($1.50), compared to $US0.63 ($0.70) a decade ago, while in Melbourne it is $US1.35, compared to $US0.57 a decade ago.
In comparison, in Singapore it currently costs an average of $US1.73 for a litre of unleaded petrol, compared to $US0.69 a decade ago.