[efficax]

interest rates are controlled by central bankers, not magic. they make decisions based on their analysis of the economy. they raised rates to slow down the rate of investment and to suppress wages, in order to get inflation under control. Less money in circulation means reduced demand means prices stay lower, meaning lower inflation. that's the theory anyway, and the explictly expressed reason for raising rates by central banks. there's no mystery about it.

[eru]

So here you are suggesting that when we observe that interest rates have been raised, we should conclude that the economy was strong? (Otherwise the central bankers wouldn't have raised.)

But the original comment I first replied to seemed to suggest that high interest rates should lead us to deduce a weak economy.

[efficax]

you raise interest rates to slow economic activity, you lower them to speed it up. yes, if interest rates are raised, that means employment is too high, basically, and they want to lower it.

[eru]

> yes, if interest rates are raised, that means employment is too high, basically, and they want to lower it.

Not directly. The Bank of England targets inflation, not employment.

[mvdtnz]

I don't know if you're being intentionally obtuse but it doesn't matter what caused the increase in rates. The increase results in people and companies having less money to spend and investment being more expensive (by design). This means less hiring.