Consumption demand broadbased; govt capex boosts investment

In what could be a sign of recovery in consumption demand, growth in private final consumption expenditure (PFCE), which represents the economy's consumption potential, improved to 7 per cent during April-June (Q1FY26) from a five-quarter low of 6 per cent in Q4FY25.

- SHIVA RAJORA

Economists reckon this recovery could be a sign of the broadbasing of consumption in the economy. The latest data released by the National Statistics Office (NSO) on Friday also showed the share of PFCE in nominal gross domestic product (GDP) stood at 60.3 per cent in Q1FY26, up from 58.3 per cent in Q4FY25.

Paras Jasrai, associate director, India Ratings, said growth in sales volumes of fast-moving consumer goods picked up to 6 per cent in Q1FY26 from 5 per cent in Q4FY25.

Rural areas continued to outpace urban areas in growth in volumes for six consecutive quarters.

Favourably, the gap in growth in volumes is narrowing.