For S&P, Fitch and Scope, investment grade issues/issuers are those rated from BBB- and above, while those from BB+ and below are categorized as speculative grade. Scope includes long-term foreign-currency ratings from the highest AAA to the lowest D rating.įor all four international credit rating agencies, ratings are divided into two main groups based on the level of credit risk: investment grade for lower levels of credit risk and speculative grade for higher levels of credit risk. Fitch includes long-term ratings from the highest AAA to the lowest D rating.

Moody’s includes long-term ratings from the highest Aaa to the lowest C. S&P includes long-term ratings from the highest AAA to the lowest D rating. The policy interest rates determine the levels of the rest of the interest rates in the economy, since it is the price at which private agents (mostly private banks) obtain money from the central bank. When they do this, they have to provide collateral to guarantee that the money will be paid back. The main refinancing operations (MRO) rate is the interest rate banks pay when they borrow money from the ECB for one week. In the Euro area the policy rate is the main refinancing operations rate. The federal funds rate is essentially determined by the market but is influenced by the Federal Reserve through open market operations to reach the federal funds rate target. The federal funds rate is the interest rate at which depository institutions trade federal funds (balances held at Federal Reserve Banks) with each other overnight. In the USA the policy rate is the federal funds rate. The most common are the overnight lending rate, discount rate and repurchase rate (of different maturities).

Different countries have different policy interest rates. The interest rate which best captures the monetary authorities' policy intentions.

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