Why the inflation ease is good news for lower income groups

Income gap between highest and lowest dipped to 0.4%pts.

According to OCBC, across the different income groups, the pullback in inflationary pressures have come as a relief as headline CPI eased from 4.1% yoy in 2H 2012 to 2.8% in 1H 2013. 

Moreover, the inflation gap between the highest and lowest income group has narrowed to 0.4% points – in 1H 2013, the lowest 20% faced a 3.1% inflation versus the 2.7% for the highest 20% income groups.

Here's more from OCBC:

This is down from the 1.4% and 1.0% gap seen in the full-year 2012 and 2011 respectively, as headline CPI moderated from the 4.6% yoy and 5.2% yoy handles.

Inflation excluding imputed rentals on owner-occupied housing for the lowest 20% income group fell to just 1.3% yoy vis-à-vis the 2.5% yoy for the highest 20% income group in 1H 2013, which is also a fraction of the 3.5% yoy print seen in 2012 for the same income group.