Germany's economic sentiment index rose to -11.5 points in October from -18.2 points, according to the Mannheim-based ZEW Institute.

This was the second consecutive improvement for the ZEW index, and beat analysts' forecasts for a reading of -15.0.

The ZEW current situation index fell to 10.0 from 12.6 while analysts estimated a decline to 11.3 points.

The economic sentiment index for the Eurozone rose to -1.4 points in October from -3.8. The current situation index fell to -79.4 from -76.3.

"The indicator's rise shows that risks for the German economy have somewhat diminished according to the financial market experts. This could well be explained by the decreasing uncertainty on the financial markets during the last weeks," ZEW said in a statement.

"Slightly more experts still expect the German economy to cool down instead of brightening up. Nevertheless, the share of experts holding such a pessimistic view has once again declined compared to the previous month."

According to analysts at Digital Look, "the German economic sentiment index is telling us that the Germany economy is beginning to show signs of improvement.

"However, we must remain cautious with this data because there is a bias with 70% of survey respondents being from the financial sector. As such, Purchase Manager Indices (PMIs) are a more reliable leading indicator."

FM

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