Are you talking interest rates on the 10 year note or the Fed hiking rates.

They hide the money in the banks.
The banks are required to hold a certain percent of their total deposits in cash in the fed reserve. This must be balanced nightly and the fed pays them interest on it.
The slowly increase this and hide the money.

Don’t get me wrong getting the fed’s balance sheet down is good, but more dollars chasing the same goods is causing the inflation.
Then the large institutional investors manipulate the bond market to they can charge a higher rate this the inflation rate of the money supply.

Fiat is a big scam.