By Karen Brettell

NEW YORK (Reuters) – The dollar fell in volatile trading against a basket of currencies on Wednesday after the Federal Reserve raised its benchmark overnight interest rate by half a percentage point, the biggest jump in 22 years.

The rate increase was widely expected. The U.S. central bank set its target federal funds rate to a range between 0.75% and 1% in a unanimous decision, with further rises in borrowing costs of perhaps similar magnitude likely to follow.

The Fed also said that its $9 trillion balance sheet would be allowed to decline by $47.5 billion per month in June, July and August and the reduction would increase to as much as $95 billion per month in September.

The was last at 103.20, after getting as low as 103.07 immediately after the Fed statement.

The euro rose to $1.0553, after briefly reaching$1.0573.

The dollar was 129.87 against the Japanese yen, after briefly dropping to 129.75.

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Currency bid prices at 2:16PM (1816 GMT)

Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid

Previous Change

Session

Dollar index 103.2000 103.4400 -0.21% 7.879% +103.6000 +103.0700

Euro/Dollar $1.0553 $1.0519 +0.34% -7.16% +$1.0573 +$1.0507

Dollar/Yen 129.8650 130.1300 -0.19% +12.82% +130.2000 +129.7500

Euro/Yen 137.07 136.92 +0.11% +5.19% +137.2700 +136.7200

Dollar/Swiss 0.9809 0.9788 +0.21% +7.54% +0.9846 +0.9784

Sterling/Dollar $1.2507 $1.2496 +0.10% -7.51% +$1.2537 +$1.2468

Dollar/Canadian 1.2799 1.2842 -0.34% +1.22% +1.2853 +1.2787

Aussie/Dollar $0.7167 $0.7096 +0.97% -1.44% +$0.7182 +$0.7089

Euro/Swiss 1.0351 1.0295 +0.54% -0.15% +1.0376 +1.0285

Euro/Sterling 0.8436 0.8418 +0.21% +0.44% +0.8449 +0.8404

NZ $0.6464 $0.6436 +0.40% -5.59% +$0.6475 +$0.6423

Dollar/Dollar

Dollar/Norway 9.3890 9.4000 -0.31% +6.37% +9.4265 +9.3650

Euro/Norway 9.9113 9.8823 +0.29% -1.01% +9.9366 +9.8673

Dollar/Sweden 9.8506 9.8606 +0.18% +9.21% +9.9010 +9.8393

Euro/Sweden 10.3970 10.3779 +0.18% +1.59% +10.4121 +10.3750