The former President of the European Parliament and the Social Democratic Party (SPD) candidate would win a resounding victory if it was a straight leadership vote, according to new research.
The latest survey carried out by Forschungsgruppe Wahlen for broadcaster ZDF showed 49 per cent of Germans wanted Mr Schulz to be their Chancellor while 38 per cent would prefer Mrs Merkel to stay in office.
Martin Schulz has come out on top in a poll against Angela Merkel
Opinion polls released in recent weeks have showed declining support for the Christian Democrat (CDU) leader.
The same poll at the end of January showed that Mrs Merkel had 44 per cent of the vote compared to Mr Schulz on 40.
Earlier this month another poll also showed Mr Schulz had overtaken Mrs Merkel.
German Chancellor Angela Merkel (L) and Canadian Prime Minister Justin Trudeau (R)
The SPD, currently the junior partner in Mrs Merkel's ruling coalition, has trailed her conservative bloc for years in opinion polls until the nomination of Mr Schulz sparked a revival in support for the party, which last won an election under Gerhard Schroeder in 2002.
The latest poll also showed that the SPD, as a party, was ahead of its nearest rivals.
It had the SPD increasing its popularity by six percentage point to 30 per cent.
SPD candidate Martin Schulz
The conservative parties – the CDU and the Christian Social Union (CSU) – saw a drop of two percentage points to 34 per cent.
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The anti-immigrant Alternative for Deutschland (AfD) weakened by one percentage point but was in third place on 10 per cent.
Its fortunes have been boosted by worries about security and the integration of more than one million migrants who have arrived in Germany in the last two years.
German Chancellor Angela Merkel speaks during a joint news conference with Canadian Prime Minister
The AfD was followed by the Greens on nine per cent and the far-left Linke on seven per cent.
The pro-business Free Democrats (FDP) were on six per cent – enough to cross the five per cent threshold needed to enter parliament.
Angela Merkel in pictures Tue, November 29, 2016
Angela Merkel has served as German Chancellor since 2005 and Leader of the Christian Democratic Union since 2000. We take a look at her political career in pictures.
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German Chancellor Angela Merkel attends the gala for the 200th anniversary of Werner von Siemens on November 29, 2016 at the historic headquarters of Siemens in Berlin
Some 30 per cent would like to see a left-leaning alliance of the SPD, Linke and Greens take power while 44 per cent were against such a coalition, the poll showed.
The survey of 1,231 people was conducted between February 14-16.
Martin Schulz has come out on top over Angela Merkel in a recent poll
However, it is still very early days in the federal election which is not due until September 24.
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