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Pending interest rate hike debate pits left against right [Video]

Posted on Monday, August 31, 2015 at 9:39:16 AM

Global financial turbulence has called into question whether or not the Federal Reserve will hike up its benchmark interest rate, though it seems the plan remains to make the move sooner, rather than later. The exact timing of a rate hike, though, has sparked debate between conservative and liberal activists with differing views on the Fed's responsibilities. 

The Fed intends to raise the benchmark rate one-quarter of a percentage point sometime between mid-September and the end of the year, The New York Times reported. This move would affect interest rates across the country, including those for various mortgages - which have remained near historical low points for some time. The issue has pitted liberals, who believe the bank should hold-off on a rate hike and focus on bolstering growth instead, against conservatives, who would prefer that the Fed manage inflation by hiking up the benchmark rate.

Despite recent financial turbulence worldwide and the contention among some that the Fed should hold off on a rate hike, it seems the bank remains set on making the move soon, the Wall Street Journal explained. The Fed has stated that it will raise the benchmark rate when it is assured that the inflation rate will increase to 2 percent. Thus far, proponents of delaying the prospective rate hike in the Fed haven't made much progress with their argument, which means that, as of right now, people should continue to expect mortgage rates to rise before the end of the year.