<?xml version="1.0" encoding="UTF-8"?><root available-locales="en_US," default-locale="en_US"><static-content language-id="en_US"><![CDATA[<p>Who said living a life of luxury is easy? According to a Lifestyle Index, launched by Swiss investment bank Julius Baer (along with its new Wealth Report), the cost of luxurious living — the luxury inflation rate, if you will — is up 11.7 per cent in dollar terms over the past 12 months.<br><br>The index is based on a survey among consumers of a basket of 20 luxury goods and services conducted in four cities: Hong Kong, Shanghai, Singapore and Mumbai.<br><br>The basket includes, among other things, Lafite Rothschild 2000 wine ($3,336 a bottle, up nearly 22 per cent) Oyster Rolex watches ($32,200, up 9 per cent), Chanel bags ($4,175, 17.5 per cent), and Cohibo siglo VI cigars ($760 a pop, 5 per cent). Then, there's your Armani suits, and oh yes, boarding schools.<br><br>Julius Baer estimates there are 1.1 million rich people in Asia, worth well over $3 trillion. The reason for the high inflation on high living? More demand from rich people. Guess tight monetary policy isn't going to be able to fix that.<br><br><strong>STRICTLY BUSINESS</strong><br><br>At $6 billion, online sales account for only 2.6 per cent of the $237-billion luxury goods market now, but it is expected to touch $15 billion by 2015. The gamechanger? Fashion blogs that are trend setters in emerging countries, says a report by luxury foundation Altagamma.<br><br>(This story was published in Businessworld Issue Dated 26-09-2011)</p>