German investor confidence has risen sharply on hopes Europe's biggest economy will dodge a recession amid a global upswing next year, a new survey said Tuesday.

The ZEW Indicator of Economic Sentiment for Germany rose by a better-than-expected 22.6 points in December to return to positive territory and a seven-month high of 6.9 points.

The rise in the forward-looking indicator shows that financial market experts see economic activity stabilising by early summer 2013, said the ZEW Center for European Economic Research.

“The financial market experts forecast the development of the economic activity in 2013 with pre-Christmas optimism,” said ZEW president Wolfgang Franz.

“Although the cooling down of the economic activity will last until the beginning of 2013, Germany will not have to face a recession. However, this only applies if the crises in the eurozone do not deepen once again.”

The indicator measures analysts' outlook for the next six months. The figure is the difference between positive and negative assessments. ZEW interviewed 278 analysts for the December survey.

ZEW said that the optimistic assessment came after recent positive US economic data which “may have spurred the hope that the global economy will gain momentum.”

While the analysts' outlook was bright, views on Germany's current economic state were almost unchanged in December, with the indicator up just 0.3 points to reach 5.7 points.

With the indicator just above zero, “the German economy is rather likely to bottom out instead of already experiencing an upswing within the next six months,” said ZEW in its statement.

Economic expectations for the eurozone also rose, by 10.2 points to 7.6 points. On the current economic situation, however, the indicator nudged up just 0.4 points to the minus 79.9 points-mark. - Sapa-dpa