Germany is heading toward early elections after Chancellor Olaf Scholz’s three-party coalition broke apart during a bitter fight over the 2026 budget. The collapse ends months of internal tension and leaves Europe’s largest economy facing a period of political uncertainty.

According to Reuters, Scholz said fresh elections would be held within 60 days. The dispute centered on how to close budget gaps and manage spending priorities, exposing deep divisions among coalition partners that had already been under strain.

The breakdown could slow policymaking on issues ranging from economic growth to public investment and climate policy. For voters, the early election will likely become a test of whether Germany wants a new governing arrangement after a turbulent period in office.

The coalition’s collapse marks a major setback for Scholz and raises questions about how quickly a new political consensus can be built in Berlin.