what is a notch downgrade 
a notch downgrade is a decrease in the credit rating of a particular bond from a debt issuer it is expressed in terms of notches with each notch representing a difference in credit risk for example if a bond issuer s credit rating is downgraded from a to bbb the downgrade would be expressed as one notch a notch downgrade can occur when the creditworthiness of the bond or debt issuer deteriorates this can be due to a variety of factors including declining financial performance increased debt levels or changes in market conditions that affect the issuer s ability to meet its financial obligations a notch downgrade can have significant implications for the issuer as it may make it more difficult for the issuer to access funding in the future and may also lead to an increase in the issuer s borrowing costs it can also have negative consequences for investors in the issuer s bonds as a downgrade may indicate an increased risk of default and may lead to a decrease in the value of the bonds 