Euro zone investor morale improves slightly in May, Sentix survey shows

BERLIN, May 4 (Reuters) - The Sentix index measuring investor morale in the euro zone improved slightly in May, indicating that investors do not expect a further escalation of the Iran conflict, but Germany bucked the trend with a further decline.

* The index rose to -16.4 points from -19.2 the month before, the survey showed on Monday, better than the forecast decline to -21.0, according to analysts polled by Reuters.

* The index for the German economy, Europe's largest, bucked the trend, falling to -30.9 from -27.7 in April.

* Germany "finds itself not only in a government crisis but also in a distinct economic trajectory of its own," Sentix said.

* The survey of 984 investors taken from April 30 to May 2 showed improvement in both the euro zone's economic expectations and the current situation in May.

* Expectations rose to -11.3 points from -15.5 the previous month, while the index measuring the current situation rose to -21.5 from April's -22.8.

* "However, both indices remain in negative territory, meaning the risk of recession remains acute," Sentix said.

* The inflation barometer was only slightly above the annual low recorded last month at -42.75 in May. (Reporting by Rachel More Editing by Peter Graff)