Investor optimism in Germany rose in October, according to a closely-watched survey Tuesday, in an upbeat sign for Europe's largest economy as the continent's financial market tensions eased.

The ZEW institute's survey rose more than expected to minus 11.5 points from minus 18.2 in September. Analysts had expected a reading of minus 14.9 points.

The ZEW, or the Center for European Economic Research, said Tuesday that the results show "that risks for the German economy have somewhat diminished."

"This could well be explained by the decreasing uncertainty on the financial markets during the last weeks," the ZEW said.

Plans by the European Central Bank to buy government bonds issued by indebted countries on financial markets have helped ease market fears that the 17-country shared euro currency might break up. Buying government bonds has the effect of lowering painfully high borrowing costs that are weighing on the finances of indebted countries. The ECB would only buy bonds if the country agrees to take steps to cut its deficit.

Germany is in relatively good shape with its government finances and has kept on growing - despite the recessions and debt problems afflicting other eurozone countries such as Spain and Italy. But Germany is going through a shaky patch because the troubled eurozone countries are major trading partners.

Germany grew only 0.3 percent in the second quarter and economists differ over whether the economy could shrink slightly in the latter part of this year.

In the survey of 288 investment analysts during the first two weeks of October, "slightly more experts still expect the German economy to cool down instead of brightening up," the ZEW said.