UPDATE 1-German consumer morale seen improving in March-GfK

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By Brian Rohan

BERLIN, Feb 26 (Reuters) - German consumer morale should improve in March as steady prices and a new car purchase incentive scheme buoy consumer confidence despite concerns about the economy, the GfK market research group said on Thursday.

GfK's forward-looking gauge of sentiment, based on a survey of 2,000 Germans, rose to 2.6 in March from an upwardly revised 2.3 in February. The rise -- the sixth in a row -- beat the 2.0 estimate made by economists polled by Reuters ECONDE.

The GfK indicator's income expectation component rose to -11.0 in February from -20.5 in January, and while the "willingness to buy" component slipped to 14.6 from 15.5, this figure remained above the previous year's average of -15.1.

Component readings lag the headline number by a month.

"Stable prices and subsidies to scrap old vehicles have helped support the consumer climate," GfK said in a statement released with the figures.

A consumer incentive plan that gives 2,500 euros ($3,203) to new car buyers who trade in old vehicles, has given automakers hope that they can contain a drop-off in sales.

As for inflation, Germany's headline annual rate slowed to 0.9 percent last month from 1.1 percent in December, and analysts polled by Reuters expected it to ease further to 0.8 percent in February.