It’s largely to slow lending and credit creation. They’ve got a difficult balancing act to perform, especially since cheap money is a lot more politically popul

It’s largely to slow lending and credit creation. They’ve got a difficult balancing act to perform, especially since cheap money is a lot more politically popular than the alternative, partly because many people focus on the part where the higher rates makes their debt more expensive, or that it causes lowered employment, like you seem to be. And maintaining low rates also does things like raise asset prices, as people borrow more to pump up their leverage and returns, people spend more, companies make more, and they hire more, people make more, etc, and people generally feel a lot better about that than austerity/saving/laying low. Unfortunately, it also leads to a lot of malinvestment, where people work on a lot of ultimately useless stuff, and that tends to make countries long-term poorer than being more prudent.