The battle over who will become the conservative candidate to succeed Angela Merkel as German chancellor comes to a head this week. The leader of her Christian Democratic Union, Armin Laschet, and Bavarian Premier Markus Soeder, who runs the sister party to the CDU, have both thrown their hats into the ring to replace Merkel, whose 16 years in power come to an end after September’s election. The decision on who will take on the emboldened Greens and the struggling Social Democrats, among others, will most likely be made in the next two days. There’s a lot at stake for the EU: the ultimate winner has a strong chance of taking over the bloc’s largest economy, and Germany is the biggest contributor to the recovery fund, which aims to pull the region out of the current crisis. And there is also a chance to heal the rifts that have blown open a year into the pandemic.

What’s Happening
Le Pen's Lead | French far-right leader Marine Le Pen is increasing her chances of winning the first round of next year’s presidential election, according to a recent poll. The National Rally party leader would come first in six out of 10 scenarios in the first round if the ballots were cast this Sunday, though she would still lose in the runoff against President Emmanuel Macron.

Earnings Exuberance | A wave of upward revisions to analysts’ earnings forecasts points to an almost unprecedented economic recovery ahead. Investors are betting record amounts that Europeans will soon be traveling, buying cars and otherwise spending the cash they hoarded during the prolonged lockdowns, in a spree that will bring windfall profits for companies across the region.

China's Shadow | When the diplomatic emissaries of the Group of Seven nations met virtually late last month to prepare the ground for the leaders’ summit in June, one problem cropped up over and over again: what to do about China? Our correspondent Alberto Nardelli brings you the state of play.

Speeding Up | Europe’s lagging immunization program is finally picking up pace. Germany doubled the number of daily Covid-19 vaccinations, France hit a key milestone a week ahead of schedule, and Italy is set to ease lockdown restrictions as contagion rates slow. The EU Commission plans very soon to launch a tender for as many as 1.8 billion additional mRNA Covid-19 vaccine doses to avoid future shortages. Here’s the latest.

British Milestone | The once-distant dream of protecting enough of the population from the coronavirus or through past infection — known as herd immunity — is starting to feel within reach in the U.K. Other European nations may only hit a similar level months from now.

Brexit Backing | British voters’ attitudes are hardening against the EU in the wake of the clashes between London and Brussels over vaccines. A new Bloomberg poll shows support for Brexit has grown, and almost two-thirds of adults believe that being outside the EU helped the U.K.’s vaccination program to succeed.

In Case You Missed It
AstraZeneca Divide | When European drug regulators acknowledged a link between AstraZeneca Plc’s Covid-19 vaccine and a rare type of blood clotting, it spread another dose of skepticism across the continent. But in the poorer east, the doubts are more over the findings than the shot.

Iran Deal | An initial round of talks in Vienna over Iran’s nuclear program was a good first step, but the Islamic Republic still hasn’t shown it’s willing to do what’s necessary to come back into compliance with a 2015 agreement, a senior U.S. official told reporters Friday. Iran wants the U.S. to lift all sanctions imposed since 2017.

Polish Coal | Poland is moving ahead with a plan to restructure its power industry that would carve out coal-fired plants from the country’s biggest utilities, a major step to wean one of the EU’s biggest polluters off its reliance on carbon. It’s similar to what Germany did with its coal industry in 2014.

Draghi's Rush | Italian Prime Minister Mario Draghi is bringing forward plans for as much as 40 billion euros in new borrowing, as the cost of keeping the economy afloat drains the state’s coffers and street protests heap pressure on the government. He also wants to reach 80% vaccine coverage by the end of September.

Sofa Gate | European Council President Charles Michel said he risked creating a more serious diplomatic incident if he had reacted when Ursula von der Leyen, the Commission President, was left without a chair at a meeting with Turkish President Recep Tayyip Erdogan in Ankara. "I’m deeply sorry," he said.

Chart of the Day

European drug regulators say there’s some evidence of a link between AstraZeneca’s Covid-19 vaccine and a rare type of blood clotting, though occurrences are low. It’s up to individual countries to set guidelines, which means there’s no unified response, something that may confuse, or even worry, people due to receive the shot.

Today’s Agenda
All times CET.

• 11 a.m. Eurostat publishes retail data for February

• 4:50 p.m. EU antitrust chief Vestager discusses proposals for a Digital Services Act with European Parliament Committee