By Nina Adam

German economic sentiment unexpectedly deteriorated in April, a survey of financial analysts and institutional investors showed Tuesday, providing a healthy reality check about the German economy after a series of sharp increases in sentiment.

The ZEW indicator of economic expectations dropped to 53.3 in April from 54.8 in March, its first decline since October 2014.

By comparison, economists polled by The Wall Street Journal had predicted a rise to 55.8.

"The current weakness of the world economy is dampening export prospects and reducing the scope for further improvements of the economic situation in Germany," ZEW President Clemens Fuest said.

But the 238 analysts and investors participating in this month's ZEW survey were much more content with Germany's current situation. The corresponding indicator jumped to 70.2 in April from 55.1 in March, indicating the economic recovery is still building momentum.

Private-sector economists expect a pickup in German economic activity this year, helped by lower oil prices and a weaker euro. They project the growth rate to top 2%, which would be an increase from 1.6% in 2014.

--Karen Hage contributed to this article.

Write to Nina Adam at nina.adam@wsj.com