Anticipated Tariff Headwinds for Global M&A Activity

The global mergers and acquisitions market has been hit hard in the first quarter of 2025 as President Donald Trump’s broad tariffs continue to ripple through the economy, creating uncertainty and volatility that have slowed deal making worldwide.

In the United States, M&A volumes dropped 13 percent to $436.56 billion in the first three months of the year. Analysts attribute much of the decline to corporate hesitation, as companies weigh the risks of pursuing mergers or acquisitions in an environment clouded by unpredictable trade policy. The caution has spilled into capital markets as well, with the number of new stock offerings falling 17.7 percent even as their combined value rose 4.1 percent to $160.22 billion.

The global picture shows a mixed trend. In Asia Pacific, a flurry of large state run transactions in China pushed activity higher, yet overall sentiment remains muted as the trade war and tariff pressures weigh heavily on cross border deal appetite. Executives and bankers say the uncertainty is reshaping how boards and investors approach strategic transactions, with many preferring to delay or scale back rather than gamble on an unsettled outlook.

The slowdown has taken a direct toll on investment banking revenues. Worldwide fees from M&A advisory slipped 4.9 percent to $21.47 billion compared with the same quarter last year, prompting analysts to cut earnings forecasts for several global banks. The drag on revenues highlights how deeply the tariff policy is being felt across financial services, from advisory desks to capital markets.

Market watchers say the months ahead will test the ability of firms to stay agile and responsive. Businesses and investors are being urged to follow policy moves closely and to remain vigilant in monitoring economic signals that may influence deal flow. With trade tensions continuing to reshape the global financial landscape, informed decision making and careful strategy will be crucial in navigating the uncertainty.

Source: Reuters, “Global deal activity disappoints, M&A revenue falls as Trump pursues tariffs,” April 1, 2025.,