Many expect Chancellor Schroeder to soon wave goodbye to his post

Figures from the Gfk market research group showed that consumer sentiment for September has risen to 3.4, from an upwardly revised 3.2 in August.

The results were in direct contrast to analyst forecasts of a fall to 2.7.

Gfk economist Rolf Beurkl said the uptick may be a result of hopes that the election would boost the economy.

Gfk polls around 2,000 people on their views about the economic outlook, their hopes for income and the likelihood that they will make big purchases in the future.

Election hopes

"The fact that elections on 18 September are starting to feel close now is boosting hopes of positive economic developments, particularly among younger people ... and those in higher socio-economic groups," Mr Beurkl said.

"Despite higher oil prices and discussions about an increase in sales tax, German consumer sentiment has improved."

Whether private consumption really is experiencing an upward trend will largely depend on the extent to which fuel price increases and higher consumer taxes will affect the budgets of private households Gfk

Commentators and polls in the run-up to the election have widely predicted defeat for Chancellor Gerhard Schroeder's coalition of Social Democrats and Greens.

Weak growth and rising unemployment have made the conservative opposition a more attractive proposition to the electorate.

And one of the conservative's key strategies is thought to be behind the unexpected rise in consumer sentiment.

Conservatives led by Angela Merkel have promised to raise value added tax (VAT) to 18% from 16% in January - should they get into power.

In response consumers may be saying that they are prepared to shell out more money for purchases ahead of the increase in an effort to save money in the long run.

Lasting upturn?

"Whether private consumption really is experiencing an upward trend will largely depend on the extent to which fuel price increases and higher consumer taxes will affect the budgets of private households," the Gfk said in a statement.

However, experts were unsure about whether improving sentiment would be maintained as sky-high oil prices could still crimp growth.

Furthermore, an Ifo survey of German retailers last week showed their mood had sunk to a five-month-low as their assessment of current and future conditions worsened.

"We do not know how seriously to take this increase in the indicator," Matthias Rubisch of Commerzbank said.

Mr Beurkl from Gfk added: "For a lasting upturn in consumer behaviour we need to see continued improvement in economic growth and the labour market."

The group also warned that a clear division remained between East and West Germany with people in the East extremely pessimistic about future prospects.