During Q2 2022, deal activity for US middle-market privateequity (PE) firms remained modest amid a complexmacroeconomic and geopolitical backdrop. Raging inflationcontinues to loom, and continued interest rate hikes fuelmarket volatility without alleviating supply chain disruptions.Dealmaking in the middle market experienced a sharp dropcompared with the record-breaking activity seen in 2021, butit remains on pace for a healthy year by historic standards.With ample dry powder on hand, PE firms are well-equippedto continue to look for deals in a market that has becomecheaper thanks to falling prices and lower valuations tricklinginto private assets. Large GPs are also likely to search fordeals in the middle market as they become less willingto make massive bets and instead turn to smaller, tuck-ininvestment opportunities.