BERLIN, April 12 (Reuters) - German investor sentiment fell by less than expected in April, a survey showed on Tuesday, as a decline in inflation expectations gave some cause for hope about the outlook for Europe's largest economy.

The ZEW economic research institute said its economic sentiment index fell to -41.0 points from -39.3 in March. A Reuters poll had pointed to a reading of -48.0 for April.

"The ZEW Indicator of Economic Sentiment remains at a low level. The experts are pessimistic about the current economic situation and assume that it will continue to deteriorate," ZEW President Achim Wambach said in a statement.

"The decline in inflation expectations, which cuts the previous month's considerable increase by about half, gives some cause for hope. However, the prospect of stagflation over the next six months remains," he added.

An index for current conditions fell to -30.8 from -21.4. The consensus forecast was for a reading of -35.0. (Writing by Paul Carrel, editing by Kirsti Knolle)