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* European shares dip, Wall St seen lower
* Dollar falls vs euro, steady vs basket
* Fed statement due 1800 GMT, followed by Yellen
* Brent crude dips towards $53 a barrel on supply glut
By Nigel Stephenson
LONDON, March 18 (Reuters) - European shares fell and the dollar held steady before a Federal Reserve meeting that was expected to lay the groundwork for the first increase in U.S. interest rates in nearly a decade.
The Fed is widely expected to remove the word "patient" from its statement on the timing of its first hike since 2006, possibly paving the way for policy tightening as early as June.
Nervousness before the decision, due at 1800 GMT, weighed on
stock markets. Wall Street was expected to open lower, according
to index futures
The pan-European FTSEurofirst 300 stocks index
"Equity markets are overbought and some uncertainty is a perfect excuse to take some profits," Gerhard Schwarz, head of equity strategy at Baader Bank in Munich, said.
Earlier, shares rose across Asia. Tokyo's Nikkei index
Chinese stocks rose for a sixth session in anticipation of
fresh government stimulus. The CSI300 index
MSCI's main index of Asia-Pacific shares outside Japan
The dollar, which has risen more than 20 percent against major currencies over the past year in anticipation of higher U.S. rates, held steady. The Fed announcement will be followed by a news conference with Chair Janet Yellen.
While the trajectory of U.S. rates is clear, some analysts say recent weak economic data may delay any move beyond June.
"Our base case is that they will remove patience. If we get that and a measured message on the dollar's impact on inflation then, given the slight retracement we have seen in the first half of this week, I think the dollar will do well," said Michael Sneyd, a currency strategist with BNP Paribas in London.
Against a basket of its peers, the U.S. currency was up less
than 0.1 percent
U.S. Treasury yields edged down. Ten-year yields
However, sterling fell to a five-year low against the dollar after weaker-than-expected UK wage data and cautious minutes from the Bank of England prompted investors to push back expectations of when interest rates would rise.
Markets were also watching for finance minister George
Osborne's last national budget before parliamentary elections on
May 7. Sterling
German government bond yields fell after an auction of
10-year debt met strong demand amid concern the ECB's
bond-buying will lead to a scarcity of top-rated debt. Ten-year
Brent crude oil edged down towards $53 a barrel after a
forecast that U.S. crude stockpiles would reach record highs,
maintaining a global supply glut. Brent
Gold lifted off four-month lows, with market participants
cautious before the Fed announcement. Spot gold
(Additional reporting by Blaise Robinson in Paris and Patrick Graham in London; Editing by Alison Williams) ((email@example.com; +44 20 7542 8682; Reuters Messaging: firstname.lastname@example.org))
Keywords: MARKETS GLOBAL/