By Joseph Nasr
BERLIN/DUESSELDORF (Reuters) - The mood among German analysts and investors rose for the second consecutive month in April, a survey by think tank ZEW showed on Tuesday, as positive signs from China helped allay concerns that weakness there would hurt the export-reliant German economy.
Mannheim-based ZEW said its monthly economic sentiment index rose to 11.2 points in April from 4.3 the previous month, beating a Reuters consensus forecast of 8.0.
"Surprisingly positive economic news from China may have brightened the mood among financial market experts," said ZEW economist Sascha Steffen, adding, however, that weaker growth in China and other emerging markets remained a drag on German exports.
China said earlier this month that its economy was showing positive signs despite persistent downward pressures.
China's economic growth slowed to 6.8 percent in the fourth quarter, its weakest since the financial crisis in 2007-2008.
"If one of the biggest (economies) wobbles then the ripples are felt most strongly," Reinhold Festge, head of the German engineering association VDMA, told Reuters in an interview.
"We can get by if China has only 6-7 percent growth," he added.
Steffen added: "In addition, concern about Great Britain's possible exit from the EU seems to be having a negative effect."
A separate gauge of current conditions fell to 47.7 points from 50.7 in March.
STABILIZED MOOD
"The mood among companies has at least stabilized," said HSBC Trinkhaus economist Thomas Amend, adding this indicated that the economic low point may already have been reached.
"The international environment is stabilizing although the global economy is not showing any great momentum."
Germany's leading economic institutes last week lowered their economic growth forecast for this year to 1.6 percent from 1.8 percent, citing waning demand from abroad for German goods and services.
As the global economy loses momentum, Germany's traditional role as an export powerhouse has declined, with domestic demand taking over as the main growth driver.
The institutes said this trend would continue, predicting a further growth slowdown to 1.5 percent in 2017. The government is expected to update its economic forecasts for this year on April 20.
The German economy grew by 1.7 percent in 2015, the strongest rate in four years. The expansion was driven by robust private consumption and higher state spending, while record-high employment increased tax receipts and ultra-loose monetary policy sent Berlin's borrowing costs to all-time lows.
Expectations for the euro zone also improved, with that index rising to 21.5 points from 10.6 in the previous month. The ZEW index was based on a survey of 225 analysts and investors conducted April 4-18.