Overview

• CDU leader Friedrich Merz and SPD leader Lars Klingbeil have developed a more collaborative relationship, signaling cautious optimism for a coalition agreement.
• Major policy disagreements remain on migration, taxation, and energy, with no finalized timeline for government formation yet established.
• Internal CDU divisions over Russia policy have escalated, with some members advocating for sanctions relief and others opposing it.
• Economic organizations have raised concerns about the coalition's potential policies, warning of risks to Germany's economic stability and competitiveness.
• The SPD's upcoming member vote on the coalition agreement is expected to be a significant hurdle in finalizing the coalition.