Federal Reserve's Rate Hikes Shape US M&A Market
The Federal Reserve's interest rate decisions have a significant impact on the U.S. M&A market, making debt more expensive and reducing leverage. This has led to a shift in the types of businesses buyers are willing to pursue, with a focus on companies with predictable revenue and strong competitive advantages.
In July 2026, U.S. deal volume increased by 6.4 percent year-over-year, while Cleveland M&A market saw a decrease in deal volume, with month-over-month deal volume decreasing by 20 percent. Local companies Royal Powder Corporation, Forge Industries Inc., and Cavaliers Holdings LLC were acquired by out-of-state entities.
The acquisition of SPR Therapeutics, Inc. by Medtronic plc is an example of the trend towards high-quality assets. The addition of SPRINT extends Medtronic's ability to serve patients across the continuum of pain care.
With record levels of dry powder for private equity and strategic buyers hungry to add defensive cash flow to their books, M&A activity is expected to remain strong throughout the remainder of fiscal year 2026.