Analysts and business leaders on Monday were anxious to see a resolution to Sunday’s election deadlock, urging chancellor Gerhard Schröder’s Social Democratic Party and Ms Angela Merkel’s Christian Democratic Union to resolve the political chaos quickly. Most voiced hopes that an early resolution would help minimise instability in German and European markets.

José Manuel Barroso, the European Commission president said: “I have a duty on behalf of the European institutions to urge Germany’s political leaders to a solution as soon as possible that is stable for Europe.”