The European grading system is often used in the U.S. on pencils designed for artistic purposes. This system uses a combination of numbers and letters to denote the hardness of the graphite in the pencil. Softer pencils are classified as "B" pencils, which stands for black, while harder ones are called "H" for hard. A number is then attributed to the pencils to describe the extent to which they are soft or hard, while a medium pencil is called an "HB" pencil. The full range of the European grading system goes from 9B -- the softest pencil, to 9H -- the hardest. Soft pencils can be anywhere between B and 9B, while hard ones can be anywhere between H and 9H. In the middle there is HB, toward the soft side but not quite as soft as a B, and F, which is harder than an HB pencil but is not quite as hard as an H.
America's grading system is much simpler than the one used in Europe and tends to be used on pencils designed for office use in the U.S. There are five categories of pencil in the U.S. beginning with #1, the softest pencil, and increasing to the hardest level of #4. The scale also includes #2.5. A #1 pencil is around the same level of hardness as a B pencil in the European system. A medium-weight pencil is a #2 in the U.S. and an HB in Europe. The American scale goes up to 2H on the European scale, which is equivalent to a #4 pencil in the U.S. Meanwhile, a #2.5 is around equal hardness to an F pencil, and a #3 is closest to an H.
Soft pencils come with many advantages for artists, which may be why some U.S. pencil companies use the more complicated European grading system to categorize their products. Softer pencils leave a darker and smudgier line, which make them good for shading, but may make it more difficult to draw accurately. With a wide range of soft pencils, an artist can produce many different effects, but these pencils may not be much use in an office, as they do not write as neatly as harder pencils.
Hard pencils and medium-weight ones are more likely to be used in offices and for technical drawing, as you can be more accurate with strong graphite. Using a hard pencil for drawing may limit the amount of different textures and dynamics an artist can create, as a hard pencil leaves a lighter, thin mark that's less suitable for shading. A hard pencil, though, is very useful for basic sketches and fine detail in pencil art.