The coalition is due to meet on Wednesday for its first major meeting since the parliamentary summer break but the three parties are deeply divided over economic policy.
These divisions came to a head over the last few days after a policy paper by Finance Minister Christian Lindner of the pro-business Free Democrats (FDP) was made public on Friday, in which he demanded a fundamental "reorientation" of the government's economic policy.
The fallout from the paper raised speculation that the government could imminently collapse, forcing new elections.
Economy Minister Robert Habeck of the Greens on Tuesday called for perseverance from the government partners, saying it would be the worst time to let the coalition collapse in view of the US presidential election and the war in Ukraine.
Habeck said he thought an agreement on the 2025 budget was possible and that the Greens had already made concessions, calling on his coalition partners to compromise as well.
Chancellor Olaf Scholz of the Social Democrats (SPD) had said on Monday that he expects the coalition to continue its work: "We have a basis for this. That is the coalition agreement."
Scholz sought to play down the divisions, saying that the cabinet had put forward a draft budget in the summer and that "a few additional proposals" should now be made to the Bundestag.
Two further meetings are planned for Wednesday, involving Scholz, Habeck and Lindner, as well as state secretaries, according to information from government sources.
