The interaction between Turkey's credit rating change and CDS rating between 2010-2019

With the financial markets globalizing and integrating, the concept of credit rating has gained significance. International credit rating agencies, with the country credit ratings and outlook notifications they publish for countries, are institutes that analyze whether or not countries are able to fulfill their fiscal responsibilities in time, that inform the public with universal symbols and that are recognized by international markets. In global economies credits have an important place, especially for investors and countries. Particularly at the stage of providing the investments and the growth process of national economies, credit usage has great value. However, from the perspective of the creditors, in return of the yield they are projected to gain, they need security against the risks they undertake. Thus arose the importance of credit default swap. CDS rating is accepted as a major indicator in evaluating nationals risks and assessing the investors' risk perception towards countries. In this study, the interaction of the change in Turkey's credit rating with its CDS rating is analyzed through case analysis, the Paired Sample T-Test and the Mann-Whitney U test. As per the results, it can be said that both the rise and the fall in Turkey's credit rating has an influence on its CDS ratings.