August 2022 Middle Market Monitor

Economic indicators continued to send mixed signals in July, with the Consumer Confidence Index decreasing by 2.7 points, falling for the third consecutive month, while inflation slowed slightly. The unemployment rate dropped to 3.5% while the labor force participation rate decreased to 62.1%. The U.S Public Markets saw a consensus rise, recovering from losses in recent months. The Nasdaq Composite led the charge with a 12.3% month-over-month increase followed by the S&P 500 at a 9.1% increase and the Dow Jones at a 3.1% increase. Late in July, the Federal Open Market Committee instituted another interest rate rise of 75 basis points, matching the most aggressive hike since 1994. On a month-over-month basis, we saw a slight decrease in total middle-market M&A activity, while cross border and leveraged buy-out transactions rose. Due to large amounts of capital chasing deals and a limited supply of high-quality companies in the market, the outlook for middle market M&A transactions remains optimistic for the foreseeable future.