South Korea’s 10-year government bond yield climbed to around 4.54% in late September, approaching its highest level since October 2022 after local trading resumed following the holidays. The rise reflected a broader global bond selloff, with higher oil prices amid persistent Middle East tensions intensifying inflation concerns. Elevated U.S. yields also weighed on Korean bonds because the two countries’ long-term yields tend to move together. Stronger expectations for additional U.S. rate increases further increased the prospect of Bank of Korea tightening. Policymakers have raised the policy rate by 50 basis points through two consecutive 25-basis-point increases, bringing it to 3.00%, as stronger-than-expected economic growth led by a semiconductor boom added to price pressures. The central bank cited inflation and financial-stability risks while saying future increases would depend on economic conditions.