Low Interest Rates encourage entities to take out loans. Now, this is (all things constant) good thing as it encourages more spending on economic generating activities (building a new warehouse, buying new equipment). Governments will lower it to try and jumpstart economic activity…however rapid economic growth also brings with it rapid increases in the monetary supply. More money, more inflation.

By increasing the interest rate, you encourage more saving and less spending , which reduces the amount of money in circulation and slows inflation.

The markets have been operating at very low interest rates for awhile now. First from the 2008 Recession, and then from COVID.