New Delhi, Jan. 5 -- Consumption in India's domestic economy is expected to continue outpacing capital expenditure (capex) in 2026, supported by a fiscal policy pivot towards consumption and a revival in credit, even as corporate investment sentiment remains cautious, according to a report by Nuvama.

The report noted that consumption is likely to stay ahead of capex in 2026 for three key reasons.

First, during periods of slower economic growth, consumption typically performs better than capex. Second, fiscal policy has clearly shifted towards supporting consumption, a trend also reflected in the ongoing credit revival. Third, although consumption may not see a sharp acceleration due to weak income dynamics, demand from lower- and middle...