NEW YORK, Feb. 1 (Xinhua) -- The U.S. dollar fell sharply in late trading on Wednesday after the Federal Reserve announced a quarter-point interest rate hike.

The dollar index, which measures the greenback against six major peers, decreased 0.9 percent to 101.1840.

In late New York trading, the euro was up to 1.0983 U.S. dollars from 1.0863 dollars in the previous session, and the British pound increased to 1.2376 U.S. dollars from 1.2321 dollars in the previous session.

The U.S. dollar bought 128.81 Japanese yen, lower than 130.16 Japanese yen of the previous session. The U.S. dollar fell to 0.9093 Swiss francs from 0.9158 Swiss francs, and it decreased to 1.3297 Canadian dollars from 1.3307 Canadian dollars. The U.S. dollar weakened to 10.3522 Swedish Kronor from 10.4657 Swedish Kronor.

The Fed, as expected, on Wednesday increased the fed funds rate a quarter point to 4.5 percent to 4.75 percent.

"Inflation has eased somewhat but remains elevated," the Fed said in a statement after a two-day meeting, while reiterating that "ongoing increases in the target range will be appropriate."