Higher for longer. Over the past several weeks, those three words have spooked the stock and bond markets. The phrase refers to interest rates, and the Federal Reserve’s most recent projection is that today’s seemingly high interest rates might last longer than they and most of the world had previously anticipated. The Fed hinted towards the “neutral rate” (an invisible Goldilocks-like interest rate that keeps the economy growing but inflation under control) having to be higher than recently thought. Higher interest rates make borrowing more expensive for consumers and businesses. Thus, the fear is that the economy might eventually encounter the recession that economists have been waiting for over a year.