Fed Rate Hike Sparks Warning for Korea's Economy

The U.S. Federal Reserve has increased its benchmark interest rate for the first time in over three years, raising it by 0.25 percentage points to 3.75-4 percent.

This move comes as inflation concerns have been growing due to rising international oil prices above $100 a barrel and the Middle East crisis.

The Fed's decision is expected to increase borrowing costs for businesses, households, and governments worldwide.

Korea is also facing pressure from high interest rates and inflation, with its 10-year government bond yield topping 4.5 percent and consumer inflation remaining above 3 percent for two consecutive months.