Merkel will stay away from the Red Square commemoration, traditionally a major show of Russian military force, that will mark 70 years since Nazi capitulated to Soviet forces, a government spokesman said.

"In view of the Russian actions in Crimea and eastern Ukraine, participation would seem inappropriate to us," said her spokesman Steffen Seibert.

However, Merkel plans to visit Moscow on May 10 to lay a wreath at the Tomb of the Unknown Soldier together with Russian President Vladimir Putin, who has agreed to the plan, he said.

"The chancellor considers it important to mark the joint remembrance of the end of the Second World War and the liberation from Nazism," Seibert told reporters.

Merkel "places great value on jointly remembering the historical chapter that both our peoples lived through during World War II and during which Germany was the source of so much death and suffering," he said.

"The obligation to keep alive this memory and to commemorate the dead exists irrespective of our current differences with and of our clear criticism of Russia's attitude towards and actions in Ukraine."

Merkel has spearheaded European diplomatic efforts to defuse the standoff with Russia and has spoken dozens of times by phone and in person with Putin amid the conflict that has claimed over 6,000 lives.

On Monday she will host Ukrainian President in Berlin for talks on the latest Minsk ceasefire agreement reached on February 15, as both sides accuse each other of violations.

Seibert's comments confirmed a report by news weekly "Die Zeit" that said that Merkel's office considered it "impossible" for her to attend a military parade in Moscow.

Western powers including Germany have condemned Russia's annexation of the Crimea peninsula and accuse it of backing pro-Moscow separatist rebels fighting in eastern Ukraine with troops and weapons.

Amid the worst East-West standoff since the Cold War, many other Western leaders are also expected to boycott the military parade, where North Korean leader Kim Jong-Un is among the expected guests.

French President is scheduled on May 9 to visit the French Caribbean island of Martinique for a regional summit in preparation for this year's Paris climate conference.

According to Russian news agencies, leaders from Poland, Latvia, Lithuania and Estonia have already indicated they would not come.

Putin's spokesman Dmitry Peskov, asked whether the Kremlin had been notified by Germany on its decision, said: "I don't have this information."

But he said the refusal by some Western countries to attend would not affect the Victory Day festivities.

"This will not affect the spirit of the holiday, its emotional aspect and the scale of the festivities," Peskov said on radio station Russkaya Sluzhba Novostei.

At home, Merkel received praise for her diplomatic compromise from centre-left coalition partners the Social Democrats.

"I consider this a smart move," said the party's senior lawmaker Rolf Muetzenich, saying a complete boycott would have been inappropriate given Germany's history and the fact that "we want to maintain the dialogue with Russia".