This morning, Germany's main stock index, the DAX30, soared nearly 1% to 22,700 points, hitting a new record high again. This is also the index's nearly 20 record - breaking instances in the past two months.

It is worth noting that the starting point of this wave of rise in the German stock market happened to be in mid-to-late December, and December 16th was the day when the current German government fell. On the same day, Germany's current caretaker Prime Minister Scholz initiated a vote of confidence in the Bundestag, but failed to obtain the support of a majority of members. According to Germany's Basic Law, in this case, the Bundestag will be dissolved and a new election will be held within 60 days. Therefore, the Bundestag election originally scheduled for September 28th, 2025 has also been moved forward to February 23th, 2025.

Starting today, Germany has officially entered election week, but unlike other elections, the suspense of this election seems to be minimal. Many media said that the results of the German parliamentary election to be held on February 23th are predictable and the overall situation has basically been decided.

This conclusion is largely directly related to the stable opinion poll results in Germany over the past year. Most voters seem to have made their decisions. The latest prediction shows that German voters will oust the unpopular current Chancellor Olaf Scholz from the Social Democratic Party of Germany (SPD), and Friedrich Merz, the leader of the conservative Christian Democratic Union (CDU), is likely to replace him and form a coalition government with the SPD or the Bündnis 90/die Grünen.

In addition, the far-right Alternative für Deutschland (AfD), which has been rapidly rising for several months, is likely to be ranked second. Its vote share has approximately doubled compared with the last German Bundestag election. However, even if it is possible to become the second largest party in the German parliament, so far no other political party has publicly expressed its willingness to cooperate with the AfD.

However, this is by no means a boring farce. The essentially stagnant opinion poll results conceal a moment of political upheaval. The economy has slumped, and a series of terrorist attacks and other violent crimes committed by immigrants have sparked debates about asylum (deportation of illegal immigrants) policies. A large number of voters have lost faith in the political system and even democracy itself.

All this means that small changes in the algorithm for parliamentary elections could have huge consequences for Germany's future.

Who are the key figures in the German election?

Friedrich Merz, 69, leader of the CDU

Political leanings: Old-school conservative.

Signature policies: Suspending EU asylum rules to deport illegal immigrants at Germany's borders; abolishing gender self-identification and dual citizenship; simplifying and cutting the tax system.

Experience: When Mertz was a teenager, his father wanted him to become a mason. However, he chose the law. He was a judge, a lawyer, a member of the European Parliament, an MP, a party leader and prime minister-elect - until Merkel blocked his rise to power in the early 2000s. Mertz retired from politics and served on the boards of more than a dozen companies. He returned to politics in 2018 and won the party leadership on his third try three years later.

Olaf Scholz, 66, Chancellor of the SPD

Political leanings: Center-left, more tech-centric.

Signature policies: Generous welfare payments, generous state pensions, substantial increases in the minimum wage.

Experience: As a young man from Hamburg, Scholz was a radical anti-NATO leftist and labor lawyer. Politically and linguistically moderate, he rose steadily through the ranks of the SPD, becoming labor minister, mayor of Hamburg and then finance minister during Merkel's last term as chancellor. In the 2021 Bundestag elections, he won an extraordinary victory for the SPD.

Alice Weidel, 46, candidate for Chancellor of the AfD

Political leanings: She describes herself as a "conservative liberal." Her opponents called her a far-right extremist. In fact, she is the face of nationalist and illiberal democratic parties, and even most of her peers on the European far right view her with suspicion.

Signature policies: "remigration" or mass deportations of immigrants, possibly including second or third generation immigrants; restoration of the German mark; rapprochement with Russia.

Experience: She joined the AfD in 2013 when it was founded. According to a leaked email, she believes "people who are alien to German culture" are "flooding" into her country and that Merkel's cabinet "is full of pigs and are nothing more than puppets of the victorious powers of World War II... who are systematically destroying bourgeois society."

Robert Habeck, 55, candidate for chancellor of the Bündnis 90/die Grünen

Political leanings: Under his leadership, the definition of the Bündnis 90/die Grünen has changed; his party remains environmentalist and economically left-wing, but has moved significantly towards the center.

Signature policies: Increase defense spending from 2% to 3.5% of GDP; force investors to pay social security contributions on top of capital gains tax; remove strict restrictions on public borrowing to unlock up to 500 billion euros in investment.

Experience: In cooperation with his wife, he became a successful novelist and children's author. He brought to politics an unusually reflective and self-critical style of communication that his admirers saw as a new paradigm of decency but his detractors found offensive and false.

2025 German election polls

The data shows that voters’ views are clear and consistent. If the poll predictions are accurate, Merz and the CDU-CSU will take first place with about 30% of the vote. The AfD's vote share is slowly rising and is expected to be in second place, with about 20% of the vote. The SPD is likely to beat the Greens in the race for third place, with around 15% to 20% of the vote.

But there are some important uncertainties - the AfD vote is difficult to measure, in part because the party increasingly mobilizes non-voters and young people, and its voters generally don't like talking to pollsters.

In addition, there are three small parties whose vote share is hovering around 5% and unable to enter the Bundestag. If they fail to be elected, seats will be allocated proportionally to the major parties. But if they squeak in, Merz will have a harder time putting together a coalition that can secure a majority, and he may have to bring as many as four parties into government.

What happens after voting?

The parties are sizing up each other, and currently it seems that the parties most likely to form the government are the CDU-CSU and the SPD. If all goes well, they will draw up their negotiating positions and start discussing the government's potential priorities, which will be formalized in a document called a "Coalition Agreement." Even under the best of circumstances, this is a tricky business. But this time, the ideological differences between Merz and the center-left parties on major issues are too great and negotiations will be fraught with difficulties.

Can the AfD win the German election?

Almost certainly: no. Even after the AfD helped Merz win a symbolic vote to deport illegal immigrants in the Bundestag on January 29th, the taboo of collaborating with the far right remained strong.

However, Mertz is now weaker than before. Merz's opponents (as well as some of his right-wing allies) are already considering a scenario in which Merz is unable to reach a coalition agreement with other centrist parties but still decides to run for the chancellorship. In that case, they say, he could nominate himself to the Bundestag and challenge other parties to back him - and be brought to power on the AfD's votes.

The bigger worry for mainstream parties, however, is that if a broadly centrist coalition government fails to address the issues that voters care about most, growing numbers of people may abandon their reservations in favor of the AfD, which would give it a strong enough platform to become a serious contender for first place in the next election.