Although the Illinois senator, who is expected in the German capital on July 24, has not yet put in a request for the venue, the pending visit has been the subject of much debate in Germany.

Merkel felt a "certain unease" at the idea, government spokesman Thomas Steg said last week, noting, however, that the decision lay with the city authorities and not with the federal government.

Berlin Senate spokesman Richard Meng said Sunday that the city was working with Obama's camp to find a suitable location for the speech, and the Brandenburg Gate remained an option.

Doesn't want controversy

Obama sought to defuse any tension that has arisen over the venue, saying: "I want to make sure that my message is heard as opposed to creating a controversy."

"Our goal is for me to lay out how I think about the next administration's role in rebuilding a trans-Atlantic alliance," he was quoted as saying by the New York Times on Sunday. "I don't want the venue to be a distraction."

Germany's mass-circulation Bild newspaper said Obama's advisors had promised the chancellor he would not speak at the Brandenburg Gate.

While welcoming the visit, Merkel expressed reservations at the notion that Obama could use the backdrop of the historic setting to promote his bid to become the next president of the United States.

She was joined in this view on Sunday by conservative Christian Social Union politician Erwin Huber, who said Obama should not be granted the privilege to speak there because he had played no rule in German unification.

Historic site

The Brandenburg Gate has strong historical overtones. It was the symbol of German division when the Berlin Wall cut across it and later of unification after the wall fell in 1989.

Former presidents Ronald Reagan and Bill Clinton made key speeches

there while in office. In 1987 Reagan urged the Soviet Union's last communist leader Mikhail Gorbachev to tear down the wall.

But not everyone is opposed to Obama speaking there. Merkel's deputy, Foreign Minister Frank-Walter Steinmeier, had no difficulty with the idea, his spokesman said. Berlin Mayor Klaus Wowereit has also backed the notion.