Preliminary talks between Germany's CDU and SPD have yielded an early result, with the parties agreeing on a special fund to boost defense spending, freed from the "debt brake."

Despite declarations by Friedrich Merz, the likely future chancellor, the future government's road to taking office looks to be long and strewn with pitfalls.

A senior member of Germany's conservative bloc has called on the Social Democrats to put party interests behind those of the country, as both parties are widely expected to begin talks on forming the next government.

The conservatives and the Social Democrats (SPD) agreed to seek a loosening of Germany's debt brake to allow higher defence spending, and to propose the creation of a 500 billion euro infrastructure fund,

Germany's conservatives and Social Democrats (SPD) on Tuesday held talks on forming a coalition as hopes for buoying Europe's largest economy rose on the prospect of a nearly trillion euro borrowing boom to fund military and infrastructure spending.