FXStreet reports that economists at MUFG Bank are discussing the possible results of the Germany election.

“A ‘traffic-light’ coalition comprising of the SPD, the Greens and the FDP seems most likely but the TV debate last night revealed policy differences between the Greens and the SPD on issues covering China and Nord Stream and energy supply in general so it seems likely that similar to previous recent elections, it could take considerable time before we have a new government.”

“A shift to the left with Die Linke doing better than expected that points to a possible coalition with the SPD and the Greens would perhaps be the biggest surprise and could result in the initial focus being on more expansionary fiscal policy with a slower return to fiscal discipline. All the most likely scenarios do suggest some level of growth-orientated policies being put into action which should help reinforce the favourable macroeconomic outlook in the eurozone that is currently being helped by the roll-out of NGEU fiscal spending, which got underway in August.”