Credit markets are financial markets where borrowers and lenders engage in transactions involving loans and credit. These markets facilitate the issuance and trading of debt instruments, such as bonds and loans, allowing individuals, companies, and governments to raise funds for various purposes. Lenders earn interest on the money they provide, while borrowers gain access to capital needed for investments or expenditures. In credit markets, the terms of borrowing, including interest rates and repayment schedules, are determined by factors like creditworthiness and market conditions. Credit ratings play a crucial role in assessing the risk associated with lending to different borrowers, influencing the cost of borrowing and the availability of credit.