Merkel was outraged after leaks from former government contractor Edward Snowden revealed that the NSA had monitored her communications along with those of other world leaders.
In an interview with German station ZDF, Obama said that Germany was a key ally and that the U.S. would need to win back their trust.
“A lot of suspicion had been built up in Germany and frankly around the world in the wake of the Snowden disclosures, and it's going to take some time to win back trust,” said Obama, according to reports.
"Even if we have disagreements of any sort, the one thing that I know is that I have established a relationship of friendship and trust [with Merkel], in part because she's always very honest with me and I try to be very honest with her," he continued. "I don't need, and I don't want, to harm that relationship by surveillance mechanisms that somehow would impede the kind of communication and trust that we have.
"What I can say is as long as I am president of the United States, the chancellor of Germany will not have to worry about this," the president added.
Obama’s interview with the German station came a day after he announced his long-awaited reforms to the NSA’s monitoring and collection of phone and internet traffic.
Among the president’s steps are judicial approval before the NSA can access its collection of phone call metadata and moves to have someone other than the government store that information.
Critics of the NSA say Obama’s reforms do not go far enough to rein in the agency and are vowing to push for additional controls.
In his address on Friday, Obama defended the agency, saying it had acted lawfully to protect lives from terror attacks and took a jab at foreign critics.
Obama said that other nations, many of which “feign surprise” at Snowden’s revelations, engage in similar surveillance practices or secretly rely on American intelligence.
But Obama also sought to reassure those abroad that the U.S. “is not spying on ordinary people who don't threaten our national security.”