By Andreas Rinke and Matthias Williams BERLIN (Reuters) -Election winner Friedrich Merz on Tuesday ruled out a quick reform to Germany's state borrowing limits known as the "debt brake" and said it was too soon to say whether the outgoing parliament could wave through a massive military spending boost.

Outgoing German chancellor Olaf Scholz conceded the election and decried the historic gains of the far-right conservative party, AfD. Early exit polls show AfD is headed for second place, while opposition leader Friedrich Merz’s conservatives are in the lead and Scholz’s party fell to third.

Germany's mainstream conservatives have won the country's national election, while a far-right party surged to become the country's second-largest party.