Germany's coalition partners could agree on a draft budget for 2024 this week, according to Chancellor Olaf Scholz's Social Democrat (SPD) party.
"We have made significant progress," Saskia Esken, co-leader of the SPD, said on ZDF television on Monday. "Something will happen now."
Scholz's three-way coalition is trying to strike a budget deal after court ruling last month upset its financing plans and forced it to suspend a constitutionally enshrined "debt brake" for the 2023 budget.
Finance Minister Christian Lindner of the fiscally conservative Free Democrats (FDP) wants to impose the debt brake for 2024, which restricts Germany's public deficit to 0.35% of gross domestic product.
But Scholz and Economy Minister Robert Habeck of the Greens want the debt brake suspended again in 2024, for the fifth year in a row.
The head of the FDP parliamentary group in the Bundestag, Christian Duerr, expressed optimism on Monday about talks on the 2024 budget on Deutschlandfunk radio.
Lindner has estimated Germany faces a funding gap of around 17 billion euros in a budget with a total volume of around 450 billion for 2024.
"That is manageable," Duerr said. However, the consolidation path must be continued, he said, referring to the need to cut costs.
Negotiations among the coalition partners will continue on Monday. (Reporting by Christian Kraemer, writing by Maria Martinez, editing by Rachel More and Jane Merriman)