As a dispute between Ankara and Berlin escalates over the cancellation of the two events, Merkel also stressed that Berlin was right to criticise Ankara over press freedom.
The decisions to cancel two rallies by Turkish ministers in Germany were "taken by municipalities, and as a matter of principle, we apply freedom of expression in Germany," she said.
"I also think that it was right of us to criticise any restrictions on press freedom."
In the latest episode, both sides were locked in a new row over the decisions by the small town of Gaggenau and the city of Cologne to block rallies by Turkish ministers this week.
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The ministers were due to promote a referendum in April which would expand Erdogan's powers and scrap the prime minister's post.
Justice Minister Bekir Bozdag had been expected to speak in Gaggenau yesterday but the town of around 30,000 inhabitants said it did not have the capacity to host an event likely to see a high turnout.
The cancellations were met with anger in Ankara, where Foreign Minister Mevlut Cavusoglu accused Berlin of seeking "to get in the way of a strong Turkey".
"They don't want Turkey to campaign here, they are working for a 'No'," he said.
He also accused German officials of double standards and failing to "honour democracy, freedom of expression or freedom of assembly".
But German foreign ministry spokesman Martin Schaefer said "that is a decision the federal government has absolutely no influence on ... Because it falls under local or state jurisdiction on which we have zero influence".
Erdogan's government is keen to harness their votes for the April 16 referendum.
The latest dispute comes just days after Ankara detained Deniz Yucel, 43, a correspondent for Germany's Die Welt daily, charging him with spreading terrorist propaganda and inciting hatred.
A dual national, he has been in custody since February 18, prompting Germany's Vice Chancellor Sigmar Gabriel to say that the case would make "everything harder" for Turkish-German relations.