German consumer confidence improved at the start of the new year, a key survey showed on Tuesday, as government support measures help keep the lid on energy costs.

Pollster GfK said its forward-looking survey of around 2,000 people climbed 3.7 points to reach -33.9 points for February, the fourth consecutive monthly increase.

"Falling prices for energy, such as gasoline and heating oil, have ensured that consumer sentiment is less gloomy," said GfK's consumer expert Rolf Buerkl.

Falling prices for energy, such as gasoline and heating oil, have ensured that consumer sentiment is less gloomy- GfK consumer expert Rolf Buerkl

But he warned that the indicator was still at a "very low level" overall and that the months ahead would remain "difficult" for Europe's top economy.

"Private consumption will not be able to make a positive contribution" to economic growth this year, he said.

The German government unveiled a €200 billion support package last year after Russia's war against Ukraine sent energy prices surging.

The fund includes a cap on electricity and gas prices for households from January. Mild winter weather and a recent drop in the wholesale prices of natural gas have further helped ease concerns.

Chancellor Olaf Scholz said last week he now expects the German economy to dodge a recession in 2023.

In its October forecast, the government was still predicting a 0.4 per cent contraction for this year.

Economy Minister Robert Habeck will unveil the newest forecasts on Wednesday.