With less than eight weeks to go until German elections, support for the centre-left Social Democrats (SPD) has fallen to 20 percent, the lowest level since August 2008, while Merkel's center-right bloc (CDU/CSU) continues to fly high on 37 percent, the Forsa survey for Stern magazine said.

Manfred Guellner, the head of the Forsa institute, said that the dip in support for the SPD was partly caused by a scandal involving Health Minister Ulla Schmidt who took her official car on holiday, prompting a public outcry.

"The affair stirred up all the reservations about the SPD that were already there: incompetence and distance from the people," said Guellner.

Frank-Walter Steinmeier, the SPD's chancellor candidate and current German foreign minister, has struggled to make dents in Merkel's popularity despite unveiling a campaign team including several new faces and making a contentious pledge to bring full employment to Europe's largest economy by 2020.

However, in Germany's complex system of coalition politics, voters choose parties, not individuals, and elections do not boil down to a straight race between the two main parties.

End in sight for grand coalition?

Merkel wants to ditch the SPD – currently junior partners in an unwieldy grand coalition – and govern instead with the liberal Free Democrats (FDP), whose support also rose by one point to 14 percent, according to the poll.

This would, in theory, give Merkel the necessary majority to form her desired coalition after the September 27 election, albeit with a slim 51 percent.

The Green Party rose by one point to 13 percent and the far-left Left Party also gained in support, rising to 11 percent.

Forsa surveyed 2502 voters over a four day period at the end of July.

nda/AFP/Reuters

Editor: Susan Houlton