FRANKFURT, Oct 27: German business confidence dropped to its lowest point in more than five years in October, the widely-watched Ifo index showed, as the world’s leading exporter was hit hard by the financial crisis.

The monthly business climate index calculated by Munich-based economic research institute Ifo fell to 90.2 points from 92.9 points in September, its fifth straight drop. It marked the lowest level since May 2003, when the index stood at 89.6 points.

A sub index of expectations for the next six months dropped to an all-time low point of 81.4 points.

“Germany is heading for a serious recession,” said Bank of America senior economist, adding that it “may not abate before mid 2009.”—AFP