**5. Conclusion**

The gold, platinum, exchange rates, and CDS data of South Africa we have investigated can be seen as an early warning risk indicator for the economy. In this context, based on the TVP-VAR model, findings obtained for these indicators, expresses the asymmetric time-varying connectedness of the country**'**s economy to international financial markets.

In general, gold and CDSs are the ones that give shocks to the system, while platinum and the exchange rates are the ones that take the shocks. When the positive

### *Asymmetric TVP-VAR Connectedness Approach: The Case of South Africa DOI: http://dx.doi.org/10.5772/intechopen.107248*

and negative effects of each of the variables are examined, it is clearly seen that there is a difference in whether the system is shocked or not.

In the case of gold and the exchange rates, which are negative for the country, these variables are also shock receivers. This means that the positive and negative variables in question reveal a trend in the same direction for the country. However, the negative effects of CDSs and platinum, that is, an increase in CDSs, which is negative for the country, and changes in platinum prices are shock generating for the country.

An important point to note about CDSs is that shocks originating from the agricultural sector, which are not included in our model, but which are especially important for most countries, should also be taken into account. Assuming that the CDS data will be affected by such shocks, we can say that this connectivity may be effective in the country**'**s economy due to its high value.

Net effects show asymmetric effects due to positive and negative interactions. The important finding here is that it should be emphasised that our model is valid with a time-varying approach. This necessitates institutional policies that will synchronise the reflections of these markets from an economic point of view. Considering that the important source of demand in the precious metals sector is affected by the Chinese economy, it can be stated that the growth trend of that economy should also be closely monitored.
