Mercer NZ managing director Martin Lewington said dropping on an index was not a bad thing.
"Wellington's and Auckland's small drop in rankings is down to exchange rates and the strength of the US dollar compared to the New Zealand," he said.
"The results mean expats' dollars will go further in New Zealand than they would in say Shanghai, so we become more attractive for global talent."
The results of the index were promising for companies looking at establishing headquarters in the country or relocating expats, Mr Lewington said.
It was also important to remember there were other factors which made New Zealand attractive to growth markets, including living conditions, culture and security, he said.
Australian cities had some of the most dramatic falls in this year's survey.
Sydney, ranked Australia's most expensive city for expatriates, dropped 17 places to the 26th most expensive city.
Melbourne, Perth, Brisbane, Canberra and Adelaide also had falls.
Mercer spokesman Ed Hannibal said rankings were affected by recent world events including economic and political upheavals.
These resulted in currency fluctuations, cost inflation for goods and services, and volatility in accommodation prices.
While Luanda in Angola and N'Djamena in Chad - ranked as the two most expensive cities in the survey - were relatively inexpensive for local residents, they were costly for expatriates because of the price of imported goods, he said.
"In addition, finding secure living accommodation that meets the standards of expatriates can be challenging and quite costly.
"This is generally why some African cities rank high in our survey," Mr Hannibal said.
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