German investor sentiment fell in April for the first time since October, with worries about the global economy hurting the outlook for exports, a closely-watched survey published on Tuesday showed.
Think tank ZEW institute said its economic sentiment index dipped to 53.3 in April from 54.8 in March. This was below expectations for a reading of 55.3 in a poll of economists surveyed by Reuters.
"The German economy is in good shape. A stable labour market and increasing wages are strengthening confidence and boosting consumption," ZEW President Clemens Fuest said in a statement.
"However, the current weakness of the world economy is dampening export prospects and reducing the scope for further improvements of the economic situation in Germany."
Following the release of the data, the euro extended its falls to around $1.0677. Germany's blue-chip Dax index gave up some of its gains, retreating below the 12,000 mark.
The unexpected fall in the ZEW index also reflected concerns about Greece, which is desperately trying to avert a sovereign debt default, some analysts said.
Read MoreECB staff mull plans for Greek 'disorderly default'
"April's fall in German ZEW investor sentiment suggests that fears over Greece are starting to dent confidence in the German economic recovery," said Jennifer McKeown, senior European economist at Capital Economics, in a note.
"At +53.3, the index remains at a high level by past standards and the fact that it is strongly positive means that the majority of investors still see economic conditions improving in future," she added.
Germany is Europe's biggest economy and is seen as one of the main beneficiaries of a weak euro.
Read More German GDP forecasts hiked on weak euro
Last week, Germany's Ifo Institute, an influential think tank, said it expected German gross domestic product (GDP) to rise by 2.1 percent in 2015, up from a previous forecast of 1.2 percent.
Follow us on Twitter: @CNBCWorld