**Friedrich Merz leads a CDU/CSU-SPD coalition government formed after the 2025 federal election, with the next Bundestag vote scheduled for 2029.** Traders assign an 85.5% probability that he remains chancellor through 2026, reflecting structural barriers to removal under the Basic Law—primarily the requirement for a constructive vote of no confidence—and the absence of any coalition collapse or leadership challenge sufficient to force an early exit. Recent developments reinforce this consensus. The coalition held a two-day cabinet retreat in late August 2026, publicly emphasizing unity, economic recovery signals after three years of recession, planned growth above 1% for 2027, pension and tax reforms, and new security measures. Merz and SPD Finance Minister Lars Klingbeil presented a coordinated front despite low personal approval ratings (around 13-15% satisfaction) and national polling where the AfD leads. Earlier summer tensions, including a July parliamentary group leadership change and cabinet reshuffle following a surrogacy controversy, produced internal friction but did not fracture the coalition or prompt sustained calls for Merz’s departure. Upcoming September 2026 state elections in eastern Länder pose risks, with the AfD competitive or leading in several, yet centrist parties view a snap federal vote as potentially more damaging. No verifiable triggers—such as a successful no-confidence motion, major defections, or health/legal events—have emerged in the past month to shift the implied probability. The market pricing aligns with the practical difficulty of replacing an incumbent chancellor before the next scheduled election absent extraordinary developments.