PPP & Cost of Living Calculator
PPP Exchange Rates vs Market (2025)
| Country | Currency | Market Rate | PPP Rate | Over/Undervalued | Big Mac Price |
|---|
PPP rate = Cost of basket in local / Cost in base. Overvalued > 10% above market. Source: World Bank, Economist Big Mac Index.
Purchasing Power Parity 2025: PPP Calculator, Big Mac Index, and Global Cost of Living
Purchasing Power Parity (PPP) measures how much goods cost across countries. In 2025, the US dollar buys 30% more in India than market rates suggest. This PPP calculator compares 190+ countries using Big Mac Index, PPP exchange rates, and cost of living. Adjust expat salaries, remittances, or investments with real purchasing power.
What Is Purchasing Power Parity?
PPP = Price of identical basket in Country A / Price in Country B. If a Big Mac costs $5.50 in US and ₹180 in India (market ₹83/$), PPP rate = ₹32.7/$. Market rate overvalues rupee by 60%. Absolute PPP: Same price. Relative PPP: Adjusts for inflation.
Big Mac Index 2025
Economist’s fun PPP proxy. US: $5.50. Switzerland: $7.80 (+42% overvalued). India: $2.20 (-60% undervalued). China: $3.60 (-35%).
Top 10 Most Overvalued Currencies 2025
- Switzerland (CHF): +42%
- Norway (NOK): +35%
- Sweden (SEK): +28%
- Denmark (DKK): +25%
- Canada (CAD): +18%
- EU Eurozone: +15%
- Australia (AUD): +12%
- UK (GBP): +10%
- Japan (JPY): +8%
- New Zealand (NZD): +7%
Top 10 Most Undervalued Currencies 2025
- India (INR): -60%
- Indonesia (IDR): -55%
- Egypt (EGP): -52%
- South Africa (ZAR): -48%
- Vietnam (VND): -45%
- Philippines (PHP): -42%
- Pakistan (PKR): -40%
- Ukraine (UAH): -38%
- Turkey (TRY): -35%
- China (CNY): -33%
PPP vs Market Exchange Rates
Market rate: Supply/demand. PPP: Cost of living. $1 = ¥7.1 market, but PPP ¥4.9 (China undervalued). Use PPP for real GDP: China #1, India #3.
Cost of Living Comparison
$1000/month in New York = $300 in Mumbai (PPP). Expat salary: NYC $80K = ₹25L in India for same lifestyle. Use our purchasing power parity calculator.
PPP in Real GDP 2025
Nominal: US #1 ($28T). PPP: China #1 ($35T), India #3 ($15T), US #2 ($28T). Developing nations rise in PPP rankings.
How to Use PPP
- Expat Relocation: Adjust salary
- Remittances: Real value received
- Investing: Undervalued markets (India, Vietnam)
- Travel: Budget accurately
Limitations of PPP
Basket differs by culture. Non-tradable goods (rent, services) dominate. Short-term volatility ignored. Big Mac fun but imperfect.
Future of PPP: AI, Climate, Remote Work
2025+: Digital nomads use PPP for location arbitrage. Climate migration shifts costs. AI standardizes global baskets.
Conclusion: See Beyond Exchange Rates
Purchasing power parity reveals true value. Use our live calculator and Big Mac Index. Pair with Currency Converter for planning.
Data as of Nov 2025. Sources: World Bank, OECD, Economist.
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