The 2008 financial crisis has asymmetrically hit a variety of European countries, and therefore the risk structure of periphery and core countries has changed. As a result of this, CDS (Credit Default Swap) spreads in Germany have differed from the GIIPS countries. In reviewing the literature, there has been an increasing interest in the reasoning behind the expand in GIIPS sovereign CDS spreads. Studies in the literature have particularly focused on fiscal mismatch in Eurozone and excessive deterioration in the budget balance of GIIPS. The aim of this paper is to determine the variables that are assumed to influence Eurozone CDS spreads. In this paper, panel data analysis was done for 5 countries for the period 2008-2012 and 3-month data was used.
Key words: Sovereign Bond Spreads, GIIPS, GMM. JEL Classification: E44, F34, G12. Article Language: EnglishTurkish
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