The centre-right Christian Democratic Union (CDU) and its sister party, the Christian Socialist Union (CSU), won the German election held on February 23 with 28.6% of the popular vote. CDU leader Friedrich Merz is therefore set to be the next Chancellor and will lead coalition talks. In Germany, coalition negotiations typically last between two and three months. The new government is likely to take office by April or May, depending on the complexity of the negotiations.
The centrist parties' election manifestos took different stances on issues ranging from fiscal reform to domestic policies, despite being broadly aligned on EU policy and attitudes towards the United States. Therefore, much will depend on the coalition contract. This comes at a time when Europe’s biggest economy faces economic, trade, and geopolitical challenges.
Unless otherwise stated, all information contained in this document is from Amundi Asset Management S.A.S. and is as of 25 February 2025. Diversification does not guarantee a profit or protect against a loss. The views expressed regarding market and economic trends are those of the author and not necessarily Amundi Asset Management S.A.S. and are subject to change at any time based on market and other conditions, and there can be no assurance that countries, markets or sectors will perform as expected. These views should not be relied upon as investment advice, a security recommendation, or as an indication of trading for any Amundi product. This material does not constitute an offer or solicitation to buy or sell any security, fund units or services. Investment involves risks, including market, political, liquidity and currency risks. Past performance is not a guarantee or indicative of future results.
Date of first use: 25 February 2025
Doc ID: 4233890