Earlier, a Twitter account claiming to be that of the Hessischer Rundfunk state broadcaster had said CSU Interior Minster Horst Seehofer had announced the end of the alliance in an internal message.
Merkel is now locked in a showdown with her interior minister and frenemy Horst Seehofer, head of the Christian Social Union, which governs with Merkel's Christian Democrats and the Social Democrats.
He says people without IDs, or people who traversed another European Union state to get to Germany, had no right to claim asylum there under European Union law, which says the first point of entry into Europe is responsible for their care.
They told conservative lawmakers Tuesday they would try to negotiate a solution "in the coming days", participants who attended the meeting told AFP.
"Asylum tourism must end".
Germany should ally itself with Austria and Italy on migration and security policies, Interior Minister Horst Seehofer said on Wednesday, a shift that could prove uncomfortable for Chancellor Angela Merkel.
However, hardline Bavarian state premier Markus Soeder showed little sign of backing down, insisting Germany must start rejecting migrants at its borders and it was pointless waiting for a European solution.
Merkel "cannot prevent us from acting right now and doing what we are allowed to do legally", he added.
Angela Merkel precarious as Germany's refugee row intensifies
In theory, that could lead to a situation where people are rejected and bounced from country-to-country in the European Union, and Merkel is loath to test European unity by piling more pressure on the likes Greece and Italy, who have borne the brunt of refugee arrivals.
An ARD poll showed on Thursday that 62 percent of Germans believe refugees without papers should not be allowed to enter Germany.
She has pledged to seek a negotiated response by the European Union, which holds its next summit on June 28-29, instead of Germany taking "unilateral steps at the expense of third parties" in the bloc.
'Merkel completely alone!' Germany's top tabloid, Bild, said in a headline the same day, highlighting the fact that several CDU members were also unhappy with the status quo.
She could call a vote of confidence in herself in the Bundestag, risking a defeat and subsequent resignation, or she could sack Seehofer, destroying the CDU/CSU alliance and her parliamentary majority.
The three parties together hold 399 seats in Parliament, but without the CSU that would fall to 353 - less than a majority.
The finance minister, Olaf Scholz of the Social Democrats, also partners in the coalition, accused the CDU and CSU of thinking they were in a fantasy thriller. "Staging such a drama to serve regional elections are not appropriate", said SPD leader Andrea Nahles.
The opposition Greens, the Left Party, the liberal Free Democrats, and even the AfD echoed similar complaints.
"You could of course say that in time of disruptive change, completely different methods are needed", she said.
Battlefield 5 Official Multiplayer Trailer
Today's press conference also reiterated the message of "no loot boxes, no premium passes" for the upcoming first person shooter. Battlefield V Royale will debut sometime after launch and will feature the classic tactical signatures of the franchise.