German consumer confidence rose heading into August, a key survey showed Thursday, as once red-hot inflation looked to be on the way back down.
Pollster GfK said its forward-looking survey of around 2,000 people rose to minus 24.4 points in August from minus 25.2 points in July.
The mood among consumers hit a low of minus 42.8 points in October, as prices soared and consumers worried about the cost of heating their homes over the coming winter.
Since then, the index climbed steadily until July, when it suffered a small drop.
The August rebound meant there were good chances the "consumer climate will be able to resume its recovery course", said GfK expert Rolf Buerkl.
The improvement was carried by rising income expectations, Buerkl said.
The pay indicator rose to minus 5.1 percent, the GfK said, its best reading since the outbreak of the war in Ukraine, which shook the European economy.
The tempered pessimism owed much to the "hope of declining inflation rates", Buerkl said.
Consumer prices in Germany are not rising as quickly as they did towards the end of last year, although inflation remained high in June at 6.4 percent.
Meanwhile, the German economy recorded its second-consecutive quarter of negative growth over the first three months of 2023, pushing it into recession.
The clouded outlook meant overall consumer confidence would "remain low in the coming months", Buerkl said.
As such, "private consumption will not be able to make any positive contribution to overall economic development", he added.