Monday, September 19 2005 10:19 Hrs (IST) - World Time -

Berlin: Germany was left in political limbo yesterday (Sept 18, 2005) as the conservative opposition scratched out a narrow election victory over Chancellor Gerhard Schroeder's Social Democrats but crucially failed to secure the ruling majority it had demanded.

Schroeder and conservative candidate Angela Merkel both immediately staked their claims to lead Europe's biggest economy, insisting they had the mandate to form the next Government.

Early results released on public television put Merkel's Christian Democrats at between 35.2 and 35.3 per cent, separated only by a whisker from the Social Democrats at about 34 per cent.

Her preferred coalition partners, the pro-business Free Democrats, tallied a surprisingly strong result of around 10.3 per cent, prompting their supporters to erupt in jubilation at party headquarters in Berlin.

Merkel insisted she had the upper hand, despite failing to secure a ruling majority, and said she would negotiate with all the major parties on forming a coalition.

"We have a very clear mandate and I assume this mandate with all my power," Merkel told cheering supporters in the capital. "We now need to form a stable Government."

But the charismatic Schroeder, 61, said he had been confirmed in power.

"I feel I have won approval to provide a stable Government for the next four years under my leadership," Schroeder said.