"I want to ensure that United Kingdom companies have the maximum freedom to trade and operate within German markets, and for German businesses to do the same in the United Kingdom", she told the news conference in Berlin.
Angela Merkel has delivered her most positive assessment so far of Britain's chances of securing a good trade deal with the rest of the EU.
In a speech on Wednesday, the British Foreign Minister Boris Johnson said it would be "intolerable and undemocratic" if London continues to comply with European regulations after Brexit and cannot set its own laws when it comes to trade with the rest of the world.
She denied she was "frustrated" with the process, but said: "We very much look forward to Britain again setting out its ideas".
Asked whether she viewed the Prime Minister's wish for a bespoke Brexit deal, not based on any current models, as "cherry-picking", the Chancellor replied: "In the end, the outcome needs to be a fair balance, that deviates from the single market and not as close a partnership as we've had, but I think one can find that".
Mrs May, who will speak in Munich on Saturday about her plans for a close security relationship with the European Union after Brexit, said the Government would set out more about its plans for the economic partnership "in the coming weeks".
'We deplore it, but we want to adopt a constructive position because we want to have as close as possible partnership with Britain even after leaving the European Union both economically and politically.
The UK plans to reach consensus with the European Union on a long-term commercial agreement after the Brexit, while Brussels pointed out last week that London had to clarify what it wants from the EU.
"I'm not frustrated at all", she said.
Rachel Kent, partner at law firm Hogan Lovells and chair of the IRSG's work on the plan, said equivalence was "suboptimal for a variety of reasons" and would not work for Britain's financial services industry.
The Liberal Democrats said Mrs Merkel's use of the term "curious" was a "diplomatic way of saying "nonsensical".
But Mrs Merkel - who said Germany deplored the UK's decision to leave the European Union - insisted that there could still be a close relationship and "this does not mean that it needs to be cherry-picking".
On Tuesday, the Belgian capital will host the talks at technical and coordinators' level on the issue of border between Ireland and Northern Ireland after Brexit, the department added.
"Because as the threats evolve, as they grow, as they don't recognise borders, so we need to continue that cooperation and be able to adapt to the threats as they come".