Investors around the world have been waiting anxiously for the outcome of the political deadlock that emerged from last week’s national elections in Germany. It was finally revealed that the challenger, Angela Merkel, will assume the position of Chancellor, as Gerhard Schroeder steps down. This did not come without compromise, however, as Merkel’s Christina Democratic Party was forced to build a “Grand Coalition” and share power with other political parties. While Merkel’s eventual victory will no doubt be good for Germany, it may be very difficult for her to push her reform agenda through the other parties involved in the power-sharing arrangement. The Economist reports:

Ms Merkel will struggle to implement the main planks of her proposed reform programme: lower non-wage labour costs, further labour-market reforms…and radical tax reform.

Read More: Merkel clinches it, but the price is high