Later on Thursday, a policeman's hand was blown off on the busy Palestine Street as he tried to defuse a roadside bomb.
"He went toward the bomb. When he just moved his hand trying to do his job, it exploded," said Colonel Ahmad Husayn.
"Two other policemen were seriously hurt by shrapnel, one hit in the stomach and the other in leg," he said, adding that some civilians were also hurt.
The early morning bombardments took place on both the east and west banks of the Tigris river with the Sheraton and embassies being the most prominent targets.
No casualties were reported, but two Baghdad hospitals reported treating three people with minor injuries.
US soldier killed
The US military also announced a US soldier was killed on
Wednesday night in a roadside bombing in Baghdad. Earlier the same day, three US troops were killed in a similar attack in the north central town of Samarra and four Iraqi civilians were killed in a suicide bombing in the town of Arbil.
At the Sheraton, the building's eighth floor was marked with the impact of a hit and the lobby and various floors were strewn with broken glass.
"The hit this morning came from the front of the hotel and last
night's hit came from the back," said Hazim, 43, a hotel employee.
The 20th floor of the Sheraton, which overlooks the Fardus Square, was hit on Wednesday night from behind, according to Hazim.
A policeman guards St Joseph's
Cathedral in Baghdad.
A BBC employee was seen leaving the hotel which houses mostly journalists and foreign contractors.
"This is the third one. It is common sense to move into the BBC house," said Peter Davis, a safety adviser with the BBC.
An apartment on the third floor of a block of flats next to the Sheraton was also hit by a missile at 6:30 am (0330 GMT), said the owner of the apartment, Zayd al-Khalil.
He said the missile flew through the room where he was sleeping with his wife, who was lightly wounded in the hand.
German embassy hit
Meanwhile, a shell flew over the German embassy in the western Karrada district, hitting the first floor of offices located right behind the building.
The Turkish embassy in northern Baghdad also appeared to be
targeted, as police sealed off the building to defuse a possible bomb that was dropped off by a vehicle at around 6:00 am (0300 GMT), witnesses and police said.
An official in Ankara said the Turkish embassy in Baghdad was hit with a rocket.
Insurgents also fired a flurry of rockets at the Iranian embassy
at 6:15 pm (1515 GMT) on Christmas Eve, Iraqi police said.
A cement barrier was shattered in front of the embassy.
The attacks happened as Baghdad woke up to Christmas morning, amid fears insurgents would wage a spectacular offensive to embarrass the US military on the religious holy day.
Missiles at aircraft
In north Baghdad, in the mostly Shia Shaab neighbourhood, insurgents fired missiles at two US military aircraft that were
hovering above, said witnesses waiting in a petrol queue, adding that one of the aircraft fired back, hitting one of the vehicles in line.
There were no casualties, but AFP correspondents saw a mangled white passenger car riddled with holes and there were clear missile streaks scarring the ground and debris near the car.
"I saw the missile launched by the jet touch the ground first and then hit the car," said Najm Abd Allah, 53, who said the
incident happened at about 6:00 am (0300 GMT).
The US military was not immediately available for comment.