The mood among German consumers has improved slightly, boosted by a stable labour market despite an upswing in coronavirus cases, a closely watched survey said Wednesday.
The GfK institute's forward-looking survey of consumer confidence heading into October crept up slightly to -1.6, having dipped to -1.7 in September.
"Despite rising infection figures and the increasing fear of intensifying of pandemic-related restrictions, the consumer climate is stabilising," GfK's Rolf Buerkl said.
"The extensive economic stimulus packages for companies and consumers appear to be suitable measures to help Germany out of the worst recession of the post-war period," he added.
Chancellor Angela Merkel's government has pledged more than a trillion euros ($1.17 trillion) to help companies and citizens in Europe's top economy weather the virus fallout through loans, grants and subsidised short-hours programmes, known as Kurzarbeit.
The GfK survey, based on around 2000 interviews, found that German shoppers were much more optimistic than the previous month about their income expectations, owing to a "stable labour market" and fewer people on Kurzarbeit.
Respondents were also more upbeat about Germany's economic growth prospects.
German unemployment held steady at 6.4 per cent in August, having risen markedly in the early days of the pandemic.
The German government has also temporarily cut VAT to boost consumer spending.
A recent uptick in coronavirus cases in Germany and across Europe could dampen consumers' mood in the months ahead however as restrictions are reintroduced, the pollsters warned.
The German city of Munich, the country's third-largest, has already announced it will make face masks compulsory in some busy outdoor spaces to combat a spike in infections, while a targeted alcohol ban is being considered.