Germany's economy could contract by as much as 20% this year due to the impact of the coronavirus, Ifo President Clemens Fuest said, as German business morale tumbled to its lowest level since the global financial crisis in 2009.

The devastating forecast came as lawmakers were discussing an unprecedented rescue package worth more than 750 billion euros ($813.15 billion) for which the government wants parliament to suspend the constitutionally enshrined debt brake.

The Ifo institute's final survey results showed that its business climate index slumped to 86.1 from 96.0 in February.

In the services sector, the business climate indicator posted its steepest drop since the data was first collected in 2005, Ifo said.

Fuest said that the German economy could contract by between 5% and 20% this year depending on the length of the shutdown caused by the pandemic.