The basis point spreads between credit ratings dramatically rise for borrowers of credit qualities less than BBB.

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Basis point spreads, which refer to the difference in interest rates between two different bonds, increase significantly for borrowers with credit ratings below BBB, also known as non-investment grade or junk bonds. This is because these borrowers are considered riskier and thus require a higher return to compensate investors for the additional risk.

The Basis Point Spreads Between Credit Ratings Dramatically Rise for Borrowers