German Chancellor Gerhard Schroeder and his challenger, Angela Merkel, are campaigning in the eastern city of Dresden ahead of Sunday's vote for the only seat left undecided in this month's parliamentary elections.

Both sides hope to gain an edge in talks on a new government after the inconclusive September 18 balloting left Ms. Merkel's Christian Democrats just three seats ahead of the Chancellor's Social Democrats.

The two sides have been discussing forming a so-called "Grand Coalition" of their two parties after neither side could get enough backing in parliament to form a government. But the talks are stalled because both Chancellor Schroeder and Ms. Merkel continue to claim the right to be the next chancellor.

Sunday's Dresden vote was delayed for two weeks by the death of a candidate from a far-right party shortly before the election.

Some information for this report provided by AFP, AP and Reuters.