BERLIN

The chancellor candidate of Germany’s Social Democratic Party (SPD) said on Wednesday he was upbeat on prospects for the formation of a new government by Christmas amid accelerated coalition talks with Greens and the liberal Free Democrats (FDP).

The exploratory talks are "taking place in a very, very good and constructive atmosphere," Olaf Scholz told media in the US capital Washington, D.C.

He added that's why he was sure that the government project of the SPD, Greens and FDP could be realized.

The SPD, FDP and the Greens are heading towards a decisive phase in the talks about the formation of a government coalition.

Exploratory talks continued on Wednesday in a smaller group, according to party circles.

SPD General Secretary Lars Klingbeil told the n-tv broadcaster that the "ambitious claim" was to get things done quickly now.

“And Friday is the next time when we get together in the big group. And our aim is then to put something on the table," he said.

Klingbeil's statements were echoed by FDP General Secretary Volker Wissing who said the objective was to agree on a decision-making basis for formal coalition negotiations by Friday, which summarizes the result of the negotiations.

The negotiators of the parties then want to present this paper to their committees and make a recommendation for further action.

Meanwhile, Agnieszka Brugger, the deputy leader of the Greens in the Bundestag, sees the exploratory talks at a crucial point.

"In the last two days, we have together made great steps again," Brugger told the Berlin-based radio station radioeins.

The main sticking points in the exploratory talks are reportedly differences on tax and financial policy.

The general secretaries of the parties and their staff are scheduled to hold further exploratory coalition talks in Berlin on Thursday.