Government change sparks national optimism?
Since Friedrich Merz assumed the role of German Chancellor in May 2025, public sentiment towards his government has shown notable fluctuations, according to recent polls and reports from various institutes.
Initially, Merz's approval rating and that of his government increased following the new federal government taking office, boosted by foreign policy actions. However, by early July 2025, this trend reversed sharply, with his approval dropping by 7 points in one week to 35%, the lowest since polling began for his tenure.
Dissatisfaction with the government is growing, with only 38% of respondents satisfied with the government's performance, according to a Forsa Institute poll. Criticism targets the government's refusal to reduce the electricity tax, a topical issue in political debates.
Merz's party, the CDU/CSU coalition, has slightly increased its support in polls, reaching about 30%, up 1 percentage point from late June. This contrasts with the Social Democratic Party (SPD), Merz’s coalition partner, which continues to lose support, polling at just 13%.
The Merz government has emphasized economic reforms, housing and education policy changes, social welfare reform, and stricter migration controls. However, these policy shifts have mixed reception, with some polls indicating a resurgence in national sentiment and improved economic optimism despite ongoing challenges.
Prior to taking office, Merz was the preferred Chancellor for 32% of voters, leading other candidates. However, his personal popularity is waning amid criticism of government performance, especially around economic and energy policy.
Pollster Matthias Jung believes that credible announcements of measures could potentially improve the mood. The Ifo Institute's business climate index shows an upward trend, but it was significantly lower at 88.4 points than it was shortly after the traffic light government took office. The Federation of German Industries sees more optimism among companies, but expects a slight recession this year.
The consumer climate, as measured by the GfK consumer climate, remains cautious. Expectations for the economy and income have improved, but people are saving instead of spending. The consumer climate indicator predicts a slight decline for July 2025 compared to the previous month.
The recent spat over the appointment of constitutional judges last week made the black-red coalition appear very divided, further adding to public dissatisfaction. The German Chamber of Industry and Commerce shares a similar view, stating that the economic recovery has yet to materialize. The Federation of German Consumer Organizations criticizes the coalition for not reducing the electricity tax as promised.
Merz announced his goal to improve the country's mood by the summer and believes he has delivered on this. However, with growing public dissatisfaction and ongoing challenges, it remains to be seen if his government can regain the public's trust and achieve its goals.
Policy-and-legislation debates regarding the electricity tax, a topic of significant political controversy, continue to impact the Merz government's public approval ratings. The general news, therefore, increasingly centers around this issue and the government's perceived failure to address it, contributing to growing dissatisfaction among the public.
The recent spat over the appointment of constitutional judges and the slow economic recovery have further intensified criticism towards the Merz government, raising questions about its ability to deliver on its policy promises and regain the public's trust.
