US dealmakers anticipate strong greenback will stop decline in M&A. Details here
US mergers and acquisitions activity has decreased 40 per cent year over year in terms of volume. Still, dealmakers are hopeful that a surge in activity will result from the strengthening of the dollar as people rush to buy cheap real estate in the UK and Europe.
According to information, only $1.2 trillion worth of transactions have been negotiated within the US this year. Since the start of the global pandemic of Covid-19, which came before a rise in deal-making, those nine months have been the slowest. M&A volume decreased by 25 per cent in Europe and 30 per cent in Asia Pacific during the same period.
Global M&A decreased 34 per cent from the same period last year to $2.7 trillion in the nine months that ended in September. Dealmakers closed $642 billion worth of transactions in the third quarter, ending an M&A record run in which such transactions exceeded $1 trillion for eight straight quarters.
Rupee more resilient to US dollar than other EM currencies
How EM currencies are doing against US dollar
Emerging market currencies are weakening against the dollar. However, Indian rupee has slipped lesser vis-a-vis peers. Here’s a look at which currencies are the least and most hit in the last one month.
Chinese Renminbi is down 0.54% vs US dollar. It was last at 6.6975 vs US dollar showed Bloomberg data.
This currency is down 0.85% against the dollar in the last one month. It was last at 4.41 vs the greenback.
The domestic currency has depreciated 1.8% in the last month against the American currency. It closed past 79 per USD on Friday.
Once a thriving area for declining M&A markets, private equity firms are confronting their own reckoning as there has been a tightening of financing conditions. Hence, it has led to a limit on their ability to close large deals. Globally, $642 billion in buyouts were completed in the first nine months of this year, a 26% decrease.
- How many transactions have been negotiated within the US this year?
Only $1.2 trillion worth of transactions have been negotiated within the US this year.
- What is the decrease in M&A volume in Europe and Asia-Pacific?
M&A volume decreased by 25 per cent in Europe and 30 per cent in the Asia Pacific.
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