The latest opinion polls predicted a neck and neck race in Germany's parliamentary election between the centre-right and centre-left parties amid strong indications for a continuation of the present "grand coalition" between the Christian Democratic Party (CDU) and the Social Democratic Party (SPD).

German Chancellor Angela Merkel will find it increasingly difficult of forming a new coalition with liberal Free Democratic Party (FDP) as its junior partner because the public support for a centre-right coalition dwindled dramatically in the past weeks.

Her own popularity among the voters also dropped sharply. The CDU and its Bavarian sister party Christian Social Union (CSU) together with the free democrats will secure a lead of only one percentage points over the combined strength of the centre-left parties, according to the polls.

Meanwhile, Merkel's main opponent, the present foreign minister and SPD candidate Frank-Walter Steinmeier has for the first time in the campaign indicated that he is in favour of a continuation of his party's present coalition with the CDU.

"The cooperation between two democratic parties should not be seen as a misfortune in a democracy," he said in a television interview.

In the out-going coalition, the SPD remained "far below its possibilities" and the party wanted to implement far reaching measures to combat the financial crisis and to take the country out of the present recession, he said.

Steinmeier's inclination for a continuation of the present coalition comes after the FDP earlier this week threw its weight fully behind the CDU and rejected a possible coalition with the SPD, the only chance for Steinmeier to become chancellor.

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