Bi-Weekly Geopolitical Report – Introducing Friedrich Merz, Chancellor of Germany (June 23, 2025)
by Daniel Ortwerth, CFA | PDF
The last year has witnessed an extraordinary series of events in German politics. A chancellor failed a no-confidence vote. A parliament collapsed. The subsequent parliamentary election, which typically happens on a five-year cycle, was moved forward by five months. In that election, Germany’s far-right party surged to a second-place finish, capitalizing on recent successes on the regional level. For the first time since World War II, a nominated new chancellor failed to receive the necessary majority in the first round of voting and required a second round to ascend to the position. Emerging from this political turbulence, we find the new chancellor of Germany, Friedrich Merz, whose background and policies now serve as a lens to better understand the largest country in Europe and third largest economy in the world.
This report begins with a brief biography of Chancellor Merz, focusing on his political career. It continues with a discussion of the political context of today’s Germany that gave rise to his election, and it culminates with considerations of what we should expect from his leadership. As always, we conclude with implications for investors.