Heading into year-end, private equity investors have significantly more policy clarity than in H1 and it is mostly good news. A rocky tariff rollout in the US has created some winners (companies with limited exports, primarily home-country exposure and services) and losers, but increased clarity has undeniably helped markets. Few private companies are showing obviously broken business models under the tariff regime, though more will likely emerge over time. Policymakers have recently delivered more good news for investors in the form of interest rate cuts. This will make borrowing cheaper and generating returns more straightforward, which could unlock additional exit activity. Global M&A activity has already reached USD 3 trillion in 9M25 and in another encouraging sign, IPO momentum appears to be accelerating. These have translated to improving distribution profiles for US buyout funds over the past several quarters. It will be difficult to disentangle the effects of rates, tariffs, and macro factors, but the exit environment may look brighter in the quarters ahead.

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