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Merkel party leads key state vote but majority uncertain

German Chancellor Angela Merkel reacts during a Christian Democrat meeting in Stralsund, Germany, on January 19, 2013
German Chancellor Angela Merkel reacts during a Christian Democrat meeting in Stralsund, Germany, on January 19, 2013. Merkel's party was ahead Sunday after the first state poll in a general election year, exit polls indicated, but it was unclear whether

German Chancellor Angela Merkel's party was in the lead Sunday after the first state poll of a general election year, initial results showed, but the race for a ruling coalition rested on a knife-edge.

Preliminary results from Lower Saxony on public television showed Merkel's Christian Democrats leading with around 36 percent and their current coalition partners, the Free Democrats, with about 10 percent. The Social Democrats had about 32 percent and their favoured allies the Greens 13 percent.

Detailed figures pointed to a wafer-thin lead for the incumbent centre-right, the same coalition with which Merkel governs in Berlin.

But the cliffhanger campaign was due to develop throughout the night as results trickle in, determining which coalition will come out on top eight months before a national election that will decide if Merkel wins a third term.

The Christian Democrats (CDU) were down from their 42.5 percent score at the last election in 2008 but appeared to benefit from the popularity of state premier David McAllister, a half-Scot seen as a potential Merkel successor.

FDP supporters cheer in Hanover, northern Germany, on January 20, 2013
FDP supporters cheer in Hanover, northern Germany, on January 20, 2013. The pro-business FDP look to tally their best result in Lower Saxony in post-war history.

The big winners of the night, however, were the pro-business Free Democrats (FDP), who looked to tally their best result in Lower Saxony in post-war history.

Polls had indicated they risked slipping below the five-percent hurdle required for seats in the state parliament, but they seemed to get a lift from conservative voters splitting their ballots under Germany's two-vote system in a bid to rescue the coalition.

"If you look at the polls that showed the FDP at five percent three days ago and tonight they get 10 percent and we drop from 41 percent to 36 percent, it is easy to see where those five points came from," state finance minister Hartmut Moellring of the CDU said.

ARD said around 108,000 voters who cast ballots for the conservatives in 2008 had plumped for the FDP this time.

If the FDP failed to win representation, its embattled leader Philipp Roesler, who is also Merkel's vice chancellor, was seen as likely to step down -- possibly as soon as Sunday night.

The outcome seemed to give him a reprieve, however brief.

Around 6.2 million people were called to the polls in Lower Saxony, home to European auto giant Volkswagen.

If the centre-right coalition holds on to power, analysts say it will give Merkel, who already enjoys a robust lead in national polls and ranks as Germany's most popular politician, a strong boost heading into the September election.

But if the Social Democrats (SPD) and Greens manage to eke out a victory -- still a distinct possibility -- pundits say it could help shore up the battered campaign of Merkel's gaffe-prone challenger Peer Steinbrueck.

Steinbrueck, a former finance minister from Merkel's 2005-09 "grand coalition" government, was anointed by the SPD as its chancellor candidate late last year.

But he has run into trouble of late with revelations that he made around 1.25 million euros ($1.66 million) over the last three years in speaking fees, and with comments that Merkel owed much of her popularity to her gender.

The SPD's candidate in Lower Saxony, Stephan Weil, hinted that he had been forced to campaign in the face of headwinds out of Berlin.

"The SPD made gains, which is remarkable considering the not exactly easy conditions under which we fought for voters' support in recent weeks," he said.

After Lower Saxony, only one of Germany's 16 federal states is expected to vote before the general election: Bavaria, where the ruling conservatives risk heavy losses.