How risky is a corporate bond rated BBB?

A corporate bond rated BBB is considered to have moderate credit risk, as it falls within the investment-grade category. While it indicates that the issuer has a good ability to meet its financial obligations, there is still a chance of default, especially in economic downturns. Investors should be aware that bonds rated BBB may be more sensitive to changes in the market and economic conditions than higher-rated bonds. Overall, while not the highest risk, they do carry a level of uncertainty.