**Both CDU/CSU and SPD face steep national polling declines—Union often below 20-30% and SPD in the low teens—making a premature collapse and snap election highly unattractive for either side.** Recent state election losses in Saxony-Anhalt, Mecklenburg-Vorpommern, and Berlin (September 2026), where AfD and Die Linke advanced strongly, have intensified internal friction and leadership speculation around Chancellor Friedrich Merz. Yet coalition leaders have publicly recommitted to the existing agreement, with an early October Koalitionsausschuss session endorsing continued reform implementation on pensions, taxes, and the 2027 budget while stressing democratic stability against extremism. Traders view these mutual incentives—avoiding further AfD gains and preserving parliamentary seats—as outweighing current strains, supporting the 88.5% “No” implied probability that the grand coalition holds past early 2027.