GERMAN chancellor Angela Merkel has told her conservative party that she is ready to step down as its leader following state elections in which it lost ground – but plans to stay on as chancellor for the rest of her term in office, according to reports.

Merkel also reportedly said that she will not seek re-election to parliament after its current term ends, indicating that this will be her final term as chancellor. This is something that had been widely assumed, but Merkel has not offered confirmation until now.

The 64-year-old had previously indicated that she planned to seek another two-year term as leader of her conservative Christian Democratic Union (CDU) at a December party conference, but appears to be moving quickly to acknowledge pressure for change as her fourth-term government struggles to gain traction.

Merkel has led the CDU since 2000 and has been Germany’s chancellor since 2005.

There is no single obvious successor, but several potential contenders. The current parliamentary term is due to expire in 2021, and Merkel said she will not seek re-election.

She currently governs Germany in a “grand coalition” of what traditionally have been the country’s biggest parties – the CDU, Bavaria’s conservative Christian Social Union, and the centre-left Social Democrats.

Her fourth-term government only took office in March, but has become notorious for squabbling.

An election in the central state of Hesse saw both the CDU and the Social Democrats lose significant ground amid gains for both the Green party and the far-right Alternative for Germany party.