Bond ratings measure the bond's credit risk.

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Bond ratings are used to measure the creditworthiness or credit risk associated with the bond. The ratings are assigned by credit rating agencies such as Moody's, S&P, and Fitch, based on the issuer's financial strength, ability to pay interest and principal, and other factors that may affect its creditworthiness. These ratings help investors in assessing the risk associated with investing in a bond and may affect the bond's yield and price.

Bond Ratings Measure the Bond's Credit Risk