German consumer morale rose sharply heading into May, a key survey showed Wednesday, as concerns eased about the impact of high inflation on Europe's top economy.

Pollster GfK said its forward-looking survey of around 2,000 people climbed 3.6 points to reach minus 25.7 points, the seventh consecutive monthly increase.

Improving sentiment was driven by lower energy prices, government relief measures aimed at tackling high costs, and recent wage deals struck between various industries and workers, GfK said.

"More and more households are assuming that feared losses in purchasing power due to inflation will turn out to be much milder," the pollster said.

The survey found respondents were more optimistic about their income prospects and the broader economy.

But GfK consumer expert Rolf Buerkl cautioned that the gauge was "still below the pre-pandemic level seen about three years ago".

Inflation, which peaked at 10.4 percent in October, has been gradually easing, although it still stood at 7.4 percent in March.

Costs began surging after Moscow invaded Ukraine last year and slashed gas supplies to Europe, a particularly heavy blow for Germany which long relied on cheap Russian energy.

But Berlin rolled out relief measures, helping to ease fears of a sharp downturn, and diversified its energy supplies.

Germany has faced a wave of strikes by workers demanding pay hikes to compensate for high costs.

But some wage deals have recently been reached -- including with public sector workers -- easing fears of further industrial action.