Greeceâ??s rating was lowered to A2 from A1, Moodyâ??s said in a statement from London today. That left it five steps above non-investment grade and two higher than the levels assigned to it by Standard & Poorâ??s and Fitch Ratings. The rating is the lowest among the 16 euro-member states and the same as that of Poland and Botswana.

The bonds rallied after the announcement as concern eased that a steeper downgrade would make its debt ineligible as collateral at the European Central Bank.

Further cuts from Moodyâ??s, which kept a negative outlook on the rating, would cast doubt on the eligibility of Greek debt at the ECBâ??s money market operations. Moodyâ??s is the only major ratings company grading Greece above BBB+ after cuts from Standard & Poorâ??s and Fitch Ratings earlier this month. A downgrade of two more notches would mean Greek bonds wonâ??t be accepted by the ECB if it reverts to its pre-crisis collateral rules in a yearâ??s time.