NEW YORK (CNNMoney.com) - Bonds declined Wednesday as traders weighed the Federal Reserve's latest rate hike and took in the day's key economic releases on manufacturing and construction.

The dollar gained against both the euro and the yen.

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The 10-year note fell 10/32 to 99-16/32 to yield 4.56 percent, up from 4.52 late Tuesday. The 30-year bond lost 15/32 to 109-23/32, yielding 4.71 percent, up from 4.68 the previous session. Bond prices and yields move in opposite directions.

The two-year note was down 3/32, yielding 4.59 percent. The five-year note was down 7/32, yielding 4.51 percent.

The January ISM index -- a leading indicator of manufacturing activity -- fell more than expected to 54.8. That is the lowest level since Aug. '05, despite significant 4th-quarter growth in factory orders and output

Economists surveyed by Briefing.com had expected the ISM index to edge lower to 55.5 in January from 55.6 in December.

It was also announced on Wednesday that December construction spending rose 1.0 percent -- compared to analysts' expectations of a 0.2 percent gain.

On Tuesday, bonds ended mixed after the Fed raised short-term interest rates another quarter of a percentage point to 4.50 percent as was widely expected. (Full story.)

The Fed gave a less ambiguous statement than had been anticipated, but traders are still uncertain what course of action new chairman Ben Bernanke will take when he oversees his first Fed meeting in March.

The dollar rose on the Fed's rate hike. Rising interest rates generally help the dollar as they make dollar-denominated securities more attractive to foreign investors.

In currency trading, the euro bought $1.2060, down from $1.2153 late Tuesday. The dollar bought ¥118.03, up from ¥117.21 in the previous session.

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Ben Bernanke was officially sworn in as the 14th Fed Chairman -- full story here.

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