BERLIN, Sept. 29 (Xinhuanet) -- The German government denies on Thursday a newspaper report that German Chancellor Gerhard Schroeder will resign next Monday to pave the way for a grand coalition government.

    A spokesman described the report as "rubbish -- total nonsense."

    The Berliner Zeitung newspaper, quoting anonymous sources, said Schroeder would take the occasion of the Oct. 3 German Unity Day holiday as a "dignified opportunity" to quit.

    Neither Schroeder's Social Democratic Party (SPD)/Green coalition nor his conservative rival Angela Merkel's Christian Democratic Union (CDU/CSU) alliance won a majority in the Sept. 18 elections.

    The result has forced the two biggest parties to hold exploratory talks for forging a grand coalition.

    Both Schroeder and Merkel have so far refused to give up claims for chancellorship, although they expressed optimism about forminga grand coalition after a second round of talks on the matter.

    They agreed to meet again on Oct. 5, three days after Sunday's by-election in the eastern German city of Dresden, where electionswere postponed due to the death of a candidate.

    Both SPD and CDU parties are campaigning hard even though the result could not change the balance of power in the Bundestag, thelower house of parliament. Enditem