Examination of the macroeconomic variables effecting cds spreads

In recent years, CDSs come into prominence as an important indicator of country risk. Therefore, CDSs are become closely followed tool and a respectiful benchmark for country credibility by many investors, money otority and respectiful foundations. This phenomenon create itself an area in academics, and thus examination of countries' spreads and determining the macroeconomic variables effecting them become an important academic area. For these reasons, there are lots of researchs have been made in this subject in Turkey and world recently. In this research, the goal is to investigate the macroeconomic variables effecting CDS spreads of Turkey and the selected developing countries, and analyze the effect of selected macroeconomic variables on the these countries' CDS spreads. The research is Generalized Method of Moments (GMM) estimator method and Residual Linear Regression Model are used. As the consequences of the analysis, it is found out that the selected variables which are (i) increase in current account balance, (ii) real interest rates, (iii) GDP growth rates, (iv) inflation rates and (v) annual positive changes in S&P Global Equity Indices have important effects on CDS spreads.