Germany's widely-watched consumer confidence index rose half a point, reaching 8.2 points in January from 7.6 points in December, according to latest data released by market research group GfK on Wednesday.

The January reading was higher than expected by analysts and propelled the forward-looking index to a level last recorded in August 2007, the group said.

“At the beginning of 2014, consumer spending is proving to remain a strong pillar of German economic growth,” GfK economist Rolf Bürkl said in a statement.

In 2013, private consumption in Germany climbed 0.9 percent, strongly supporting full-year growth of 0.4 percent in Europe's biggest economy.

GfK economist Bürkl said that private consumption was bound to bolster economic output even stronger in 2014, as German gross domestic product was expected to surge up to 2 percent.

Germans were banking on an upswing, Bürkl added, and expected their incomes to rise accordingly. Moreover, they were increasingly spending their money rather than saving it in view of historically low interest rates.

According to the GfK survey, which was compiled from about 2000 consumers, Germans' propensity to save hit the lowest level since the country was re-united in 1990.

uhe/kms (Reuters, dpa)