South Korea’s 3-year government bond yield reached 4.09% on the morning of the 17th, its highest level of the year at 4.091%, as the U.S. Federal Reserve’s shift toward sustained monetary tightening strengthened expectations for further domestic rate increases. The Fed raised its policy rate by 0.25 percentage points to 3.75–4% on the 16th, while its median year-end projection rose by 0.3 percentage points to 4.1%. The Bank of Korea said after a market review that the Fed’s policy stance is expected to remain tight, citing Chair Wash’s emphasis on price stability and signals of further increases. South Korea’s 1-year and 2-year government bond yields also reached new annual highs, while the won weakened toward 1,380 per dollar. Analysts said major-economy rate increases, including recent moves by the European Central Bank and possible further tightening by the Bank of Japan, could accelerate the Bank of Korea’s rate-hike timetable. South Korea’s policy rate is currently 3%, after 0.25 percentage-point increases in July and August, while elevated international oil prices add to inflationary pressure.