Merkel is ready for German grand coalition

German conservative leader Angela Merkel said on Thursday she believed her Christian Democrats (CDU) were much more likely to forge a coalition with the Social Democrats (SPD) than they were with other parties.

"The possibility or likelihood of a coalition with the SPD is much higher than the other constellations," Merkel told after a meeting with the liberal Free Democrats (FDP).

Merkel had hoped to form a centre-right coalition with the FDP, but the two parties failed to secure a majority in the September 18 parliamentary elections.

FDP chief Guido Westerwelle said he had not given up hope for some kind of coalition with the CDU and its sister party, the Christian Social Union (CSU). But he acknowledged that the chances of an SPD-CDU/CSU government were much greater.

"It seems in all probability that we're heading for a grand coalition," Reuters quoted Westerwelle as saying.