The interest rate is likely to be raised in the United States this year, but exactly when depends on the strength of the numbers generated by their economy. Dr Jenny Yellen, giving her testimony on this subject, suggested that a rate is most likely this year, but she will study the data and if the numbers are strong enough, signal a hike, but always bearing in mind that any proposed rate rise should not jeopardize the economic Recovery now in hand.
Measured against the historic low interest rate which has allowed Recovery blossom (it is growing into signs of Prosperity in the United States, some parts of it anyway), the upcoming question of a Debt Ceiling raise in September may dampen spirits somewhat. Congress may hope to count on the continued support of the Republicans, but now that they are preparing the fight for the next election, their support cannot be taken for granted. They may wish to play the card that the national debt burden is already too high, and they owe it to future generations not to load it too high. So far, Mr Obama has been lucky, the Republicans co-operated in the Debt Ceiling raise of $2.15 Trillion in August 2011, and then annually such a figure seems to have been pretty quietly written in. Of course it has done the nation no harm at all, Recovery has blossomed into Prosperity, and more and more people are experiencing rising standards of living, more are buying automobiles, houses, durable goods, and clothing, and also prefer to buy higher end products, a sure sign of disposable income.
I would hazard a guess that the numbers on the U.S. economy will continue to be strong, as more and more people find work and the unemployment rate falls. That will be a great salute to the Obama administration, and how they have brought a nation from recession to Prosperity within the period of their tenure. Their policies will implicitly recommend Hillary Clinton to the nation as the ideal successor to the White House. Let's face it, people who would otherwise have voted Republican voted for Mr Obama and the Democrats at November 2012 because 'in these times, we need the blanket of the social net and the security of Obamacare' (this was one young woman from New Hampshire, but her words I think summed up the feelings across the nation at that time).
The dynamics suggest there will be monetary tightening and accordingly the rate will rise. A possible scenario may be a steady rise from the current low to about 2.5 percent over the course of the next 3 years. With rising hourly rates and gender equality in pay (evidence Mary Barras at GM), the quest for rising standards for all may ensure an environment politically and socially that will make the American people support Mrs Hillary Clinton to the White House. It would certainly cheer up the whole world to see this champion of democratic freedoms achieve the fulfilment of her dream and destiny, to be the first woman President of the United States. I pray she has God's blessings and the support of her fellow citizens in this quest.