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Katharina Bergant

Katharina Bergant

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Macro & Public Finance

Cross-border Spillovers: How US Financial Conditions affect M&As Around the World

by Dr. Prachi Mishra, Raghuram Rajan, Freddy Pinzon-Puerto, Katharina Bergant

We study how U.S. monetary policy shocks transmit to cross-border merger and acquisition (M&A) activity. Using country- and firm-level data, tighter U.S. policy is shown to reduce both the value and the number of cross-border deals. The effects are especially pronounced for acquirer firms with larger foreign-currency liabilities, consistent with a net worth channel. Reflecting agency motives for acquisitions, deals announced under more accommodative U.S. conditions underperform ex post, indicating potential capital misallocation.

19 February, 2026

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