Berlin - German investor confidence could edge up again this month, a key indicator to be released Tuesday is forecast to say, amid efforts from governments and central banks around the world to halt the downturn underway in the global economy.

Drawn up by the Mannheim-based Centre for European Economic Research, the ZEW index is forecast by analysts to post a marginal increase to minus 44.5 points in January after posting a bigger- than-expected rise to 45.2 in December.

An increase in January would represent the third consecutive rise in the index.

This is despite fresh evidence of the continuing turmoil in the global banking sector and the rapid contraction in world economic growth.

However, the build-up to the release of the ZEW index has been accompanied by a new wave of government economic stimulus packages announced around the world, including Germany, as well an on-going drive by central banks to cut rates.

European Central Bank (ECB) chief Jean-Claude Trichet warned in a speech in Paris on Monday that the bank's governing council members believe that "world and European growth in 2009 will be substantially lower than the forecasts made at the beginning of December."

This comes after the ECB last week again joined other central banks and delivered another hefty cut in borrowing costs with economists expecting the ECB to press on with its rate-cutting cycle in the coming months.

Nevertheless, many economists believe that the first signs of an economic recovery in Germany and Europe could start to emerge during the second half of 2009 paving the way for a pickup on 2010.

Based on a survey of about 290 analysts, the ZEW indicator often sets the scene for other major European economic sentiment surveys released later in the month, including Germany's closely watched Ifo business confidence survey. (dpa)