REUTERS/Michael Dalder
Germany's Eurosceptics could cause a major knock-on effect for the Eurozone
S&P's case is fairly simple. Though AfD doesn't have mass political support as yet, it's gaining momentum. After taking 4.7% of the vote in the last Bundestag elections, it won 7% in the European election and between 9.7% and 12.2% in three recent state elections in eastern Germany.
The Telegraph's Ambrose Evans Pritchard pithily describes the AfD as 'standing across Angela Merkel's path with bayonets' in his write-up of the report.
If they had their way, AfD would have Germany using the Deutschmark again, exiting from the common currency. They're picking up steam by opposing the role that Germany has played in recent years: as Germans see it, they're the guy with the checkbook.
S&P says Germany's domestic opposition to Eurozone crisis management hasn't yet had a major political voice, allowing the government some leeway on the measures it took. Both the main conservative and social democratic parties in Germany have been roughly supportive of the biggest measures to tackle the euro-crisis. Or at least, more supportive than the German public.
The German government is already a lightning rod for blame over the continent's austerity measures. The S&P report suggests that there could be even more of a bias towards tight money if Angela Merkel's centre-right CDU have to mop up AfD voters.
In the same way that UKIP has pushed British Prime Minister David Cameron to increased Euroscepticism, S&P head of sovereign ratings Moritz Kraemer explains why Merkel might have to shift to the right:
"More conservative, and arguably more eurosceptic, voters had increasingly felt their concerns were overlooked by the CDU, a trend that may have deepened since the establishment of the Grand Coalition government in late 2013.
"AfD has been successful in attracting those disenchanted voters. This has been made easier by a parallel related development: the rapid and seemingly inexorable demise of the Liberal party (FDP), which could otherwise have been a beneficiary of disgruntled voters."
If the German government and their wing of the European Central Bank (the Bundesbank) began objecting even more to monetary stimulus, it could be negative for the people of Europe's struggling periphery.
In a sort of grim irony, AfD leader Leader Bernd Lucke says that "southern European states are becoming impoverished under the pressure to compete" under the monetary union. If the Bundesbank (the German arm of the ECB) and the German government became less co-operative with Eurozone stimulus as the AfD gain popularity, it's exactly those southern European states that would suffer most.
S&P sums up its case succinctly: "Why is this a concern for the eurozone? None of this would matter much, if we were to assess that the euro crisis is safely behind us. However, this is unlikely to be the case."