By Stephen Brown
BERLIN (Reuters) - The German opposition Social Democrats (SPD) are losing support in their bid to unseat Chancellor Angela Merkel in September's election and are no longer trusted more than her conservatives on social issues, according to a poll out on Friday.
The Politbarometer poll for public broadcaster ZDF will make tough reading for candidate Peer Steinbrueck ahead of a congress of his center-left SPD in Bavaria on Sunday to present the official platform for the federal election on September 22.
The long-standing lead for Merkel's coalition widened to 46 percent versus 41 percent for the SPD and their Greens allies, while the proportion of Germans who would prefer a third term for Merkel rose three points to 63 percent.
Only 27 percent said they would prefer Steinbrueck, down from 29 percent in the last Politbarometer poll in March. The 66-year-old former finance minister, who was Germany's most popular politician less than two years ago, ranks eighth in approval ratings, where Merkel consistently ranks first.
It was the second poor survey for the SPD this week.
A Forsa poll out on Wednesday suggested for the first time in three years that Merkel could get a governing majority with one point more support than the SPD, Greens and hardline Left combined. The Politbarometer poll put the combined opposition one point ahead - but the SPD rules out an alliance with the Left because of its extreme views.
Steinbrueck is a moderate whose nomination last year meant he had to veer to the left on issues such as higher taxes and regulating banks to mollify that wing of the SPD. But his high personal earnings and verbal gaffes have alienated many left-wingers and women voters.
Embarrassed by the choice of a campaign slogan "It is we who decide" that was already being used by a temporary employment agency - not the kind of business the SPD supports - Steinbrueck told German TV that it accurately reflected voter sentiment.
"There is a craving among the people for less selfishness and more broad public welfare," said the candidate.
Party leaders worry that the economic troubles of Cyprus are prolonging the euro zone debt crisis, which plays to Merkel's strengths rather than focusing the campaign on domestic issues, where they believe they have the upper hand.
However, as well as suggesting that the German public has vastly more confidence in Merkel's ability to manage the euro crisis - 46 percent versus 10 percent for Steinbrueck - the poll said that for the first time more people trusted Merkel to bring about "more social justice" than the SPD candidate.
That could undermine the SPD's hopes that its focus on social issues such as more funding for education, equal pay for women, a minimum legal wage and more affordable housing will persuade voters to make Steinbrueck chancellor in September.
(Editing by Mark Potter)