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MANNHEIM, Germany, April 21 (Reuters) - Government economic stimulus measures and low inflation helped lift German analyst and investor sentiment in April to its highest level in almost two years, a leading survey showed on Tuesday.
The Mannheim-based ZEW economic thinktank's monthly poll of economic sentiment rose to 13.0 from -3.5 in March -- bringing the index into positive territory for the first time since July 2007 and to its highest level since June of that year.
"The sentiment indicator is affected positively by the government stimulus packages, which are increasingly effective. Furthermore low inflation rates support private consumption," the ZEW said in a statement.
The euro pushed up to session highs just under $1.30 and
euro zone government bonds pared gains after release of the
sentiment reading, which shot well beyond the 1.5 consensus
forecast
Carsten Brzeski, economist at ING Financial Markets, described the figure as good news but said there were no grounds for excessive enthusiasm, pointing out the indictor remained well below the historical average.
"There are some glimmers of hope," he added. "The deterioration of the real economy is slowing down and mixed signals from confidence indicators show that at least confidence is trying to find a bottom."
In another sign of economic recovery, the head of engineering sector association VDMA told Reuters last week that Germany's plant and equipment industry, the country's largest industrial employer, is seeing early signs of stabilisation.
A separate ZEW index measuring current conditions however fell to -91.6 from -89.4 in March, below the consensus forecast for a drop to -90.0. (Reporting by Krista Hughes and Andreas Framke, writing by Brian Rohan; editing by Chris Pizzey)