The Munich-based Ifo institute said on Friday that its business confidence index, based on a survey of 7,000 executives dropped to a five-year low in March. The index, closely watched as the barometer for the health of German business sentiment, fell to 95.4 from 96.4 in February, making it the second consecutive drop. The expectations index --which mirrors businesses' confidence about the future -- fell to a six-month low of 98.9. Ifo economist Hans-Werner Sinn said the latest figures showed that Germany's recovery was "clearly at risk". "The time has come to cut interest rates in Europe," he said. The board of the European Central Bank - which sets rates for the 12-nation eurozone - meets next on 1 April, amid speculation that it might finally drop rates below the current 2 percent set last June. The data was collected before and after the Madrid train bombings on March 11, which made little difference to the general gloom, Sinn said.