Berlin - German consumer confidence climbed more than forecast amid hopes of an improving economic outlook and a rising willingness to buy, according to a survey released Tuesday.

The Nuremberg-based GfK marketing group said its forward-looking consumer confidence index rose to 2.9 points in July, compared to an upwardly revised 2.6 in June.

Analysts had predicted that the GfK index, which is based on around 2,000 German households would essentially remain unchanged in July at 2.5 points.

"Following the recent growing number of signs that the economic downturn may be coming to an end, consumer hopes of economic stabilization are intensifying and accordingly, economic expectations are increasing moderately," GfK said in a statement.

The GfK saw both the solid state of the labour market and dwindling inflation as also helping to shore up the mood of consumers in Europe's biggest economy. The new stability in particular underpinned Germans' income expectations and propensity to buy.

But the GfK warned that the threat of rising unemployment would be the deciding factor in whether the latest uptick would lead to a sustained increase in consumer confidence.

A breakdown of the GfK survey for July showed German consumers' willingness to buy rose to 14.5 in June from 12.5 in May while income expectations jumped six points to reach a 14-month high of minus 3.3.

At the same time, a component of the GfK survey gauging economic expectations rose for the third month in a row to reach a nine-month high of minus 22.6.

The rise in the GfK index comes in the wake of a raft of key economic sentiment surveys pointing to growing optimism that the economic downturn has started to bottom out and that a pickup in the German economy should start to take shape by the end of the year.

On Monday, the Munich-based Ifo economic research institute said its closely watched German business confidence survey hit a seven- month high in June after rising for three consecutive months. (dpa)