LaTeX \rule filling the line

The horizontal rule of 1pt height and raised by 1.5pt.

Hello \leaders\vrule height 2.5pt depth -1.5pt \hfill \null

There is a package called ulem which does this

% !TEX encoding = UTF-8 Unicode
% !TEX TS-program = xelatex
\documentclass{article}
\usepackage[normalem]{ulem}

\begin{document}
normal text \uline{\textit{underline text}\hfill}
\end{document}

which will produce

For your curiosity, the option normalem for package ulem prevents ulem to produce extra underline with \em or \emph.

I don't have a satisfying answer as to why the command you presented doesn't work, but I can offer an effective workaround. Put

% Raised Rule Command:
%  Arg 1 (Optional) - How high to raise the rule
%  Arg 2            - Thickness of the rule
\newcommand{\raisedrule}[2][0em]{\leaders\hbox{\rule[#1]{1pt}{#2}}\hfill}

into your document's preface, and then you can accomplish what you were hoping to with:

Hello \raisedrule[0.5em]{1pt}