An Analysis of Sovereign Credit Ratings Impact on Financial Development in South Africa

Purpose: The study analyses the effects of sovereign credit ratings on financial development in South Africa. This became important considering that country has been receiving negative late.
 Design/Methodology/Approach: Quarterly data for period 1994-2017 was analysed using Auto-Regressive Distributed Lag (ARDL) cointegration model and its associated statistics. Error Correction Model (ECM) implemented to augment results ARDL analysing short run dynamics. chosen given order integration variables. Financial selected since it influences conditions sector stability.
 Findings: statistical revealed positively influence variables is other words higher are found contribute growth sector. Negative likely affect system as due low access external funding exodus investors, halted or decreased.
 Implications/Originality/Value: suggest authorities need consider factors which targeted by rating agencies ensure they perform expected. Governments should focus raising avoiding downgrades boost development.