German investor confidence lifted by positive signs of China's economy

German investor confidence rose for the second consecutive month in April as China's economy showed positive signs, a survey found on Tuesday.

Mannheim-based ZEW institute said its monthly economic sentiment index for Germany gained 6.9 points and reached 11.2 points in April, showing that investors and analysts were more confident about German economic outlook in six months ahead.

"Surprisingly positive economic news from China seem to have improved the sentiment amongst financial market experts," said Sascha Steffen, an economist at ZEW.

China is Germany's second biggest trading partner outside Europe. Recent data including industrial output and fixed asset investment showed signs of improvement in the Chinese economy. China's manufacturing Purchasing Managers' Index (PMI) rose to 50.2 points in March, above the 50 threshold, reflecting improvement in the country's manufacturing activity.

Experts in the International Monetary Fund and financial institutes including UBS, Deutsche Bank and JPMorgan Chase have all lifted their forecast for China's growth.

Steffen at ZEW said, however, that the German export industry was still under pressure due to slow growth in emerging markets.

"Furthermore, concern about Britain's possible exit from the EU seems to be having a negative impact," he added.

The German government was due to release its new forecast for economic growth on Wednesday. Last week, four leading economic institutes cut their forecast for German 2016 growth to 1.6 percent from 1.8 percent, citing a weak recovery of the global economy.

The German economy grew by 1.7 percent in 2015, driven mainly by private consumption and government spending. Exports, the country's traditional growth engine, made little contribution. Endit