Against the USA dollar and the euro, the kiwi dropped to 0.7303 and 1.6439 from an early 2-day highs of 0.7342 and 1.6349, respectively.
Banks benefit from higher bond yields because it means they can charge higher interest rates on loans.
Moreover, markets will also be looking for any hints regarding the bank's next interest rate increase, with about 60 percent of market participants hoping for a hike by December.
The broader all-share index also gained 50 points, or 1 percent, to settle at 4,886.48, on a value turnover of P8.1 billion.
The dollar was up 0.51 percent against the Japanese currency at 111.4 yen.
On Wall Street on Monday, the Dow Jones Industrial Average closed at a record high for the fifth straight session, and the S&P 500 marked its second straight closing record high, as higher U.S. Treasury yields helped lift financial shares. The benchmark Kospi slid 3.85 points or 0.16 percent to 2,412.20, dragged down by chemical companies and retailers.
Mattis: No need yet to shoot down North Korean missiles
War could leave millions of people in the South Korean capital of Seoul-and 28,500 USA soldiers stationed in the South-exposed. The U.S. military has described the exercises as training for readiness "to fight tonight" against North Korea if needed.
New economic projections released after the Fed's two-day policy meeting showed 11 of 16 officials see the "appropriate" level for the federal funds rate, the central bank's benchmark interest rate, to be in a range between 1.25 percent and 1.50 percent by the end of 2017, or 0.25 percentage points above the current level.
The euro was up 0.15 percent at 133.665 yen EURJPY=, recovering some of the losses suffered the previous day, when the common currency's slide against the dollar nudged it away from a 21-month high of 134.160 set on Tuesday.
A weaker dollar was supporting prices slightly Tuesday by making gold, a dollar-denominated metal, cheaper for foreign buyers. Hong Kong's Hang Seng index added 0.4 percent. Forecasters expect the Fed to leave interest rates unchanged and stick to plans to raise rates in December. They dropped 1.7% month-on-month compared to expectations of a small 0.3% increase.
Last week was the greenback's best against the yen since November, up 2.8 percent, as a rise in U.S. yields bolstered its appeal against the low-yielding yen and data showing a pickup in USA consumer prices helped kindle expectations that the Fed could hike rates again in December. It rose 2 cents to $49.91 a barrel on the New York Mercantile Exchange.
Energy companies rose along with the price of crude oil. South Korea's Kospi lost almost 0.1 percent to 2,416.05.
Regarding commodities, oil prices were in an uptrend during the Asian trading, with WTI crude rising by 0.52% to $50.15 per barrel and Brent being 0.13% higher at $55.69. Brent crude, used to price global oils, gained 24 cents to $55.38 per barrel in London.