* US dollar index at 3-year low, no change seen from Fed
* World stocks edge higher, Europe up for fifth session
* Silver rebounds after sharp losses
(Adds fresh prices, byline)
By Al Yoon and Herbert Lash
NEW YORK, April 27 (Reuters) - The U.S. dollar fell to a
three-year low and world equity markets slipped slightly on
Wednesday before a Federal Reserve decision that is expected to
reaffirm its easy monetary policy.
The dollar <.DXY> skidded to 73.493 on the Intercontinental
Exchange's dollar index, driven by widening interest rate
differentials between the U.S. and other major central banks.
For details see: []
The dollar index is almost 10 percent below its peak in
January and many traders expect it eventually to revisit an
all-time low of 70.698 hit in 2008.
The dollar index <.DXY> was up 0.12 percent at 73.929.
The Fed is set to confirm it will complete its $600 billion
bond-buying program and renew its commitment to rock-bottom
borrowing costs for "an extended period" in its statement on
Wednesday [].
In addition, Fed Chairman Ben Bernanke will hold the
first-ever regularly scheduled news conference by a U.S.
central bank chief at around 2:15 p.m. (1815 GMT).
"It's clear Fed monetary policy is the reason for dollar
weakness. If we don't get any hint that the Fed will normalise,
the dollar will continue to stay under selling pressure," said
Lutz Karpowitz, currency strategist at Commerzbank in
Frankfurt.
While the Fed continues to print money, the European
Central Bank raised rates for the first time in two years this
month and is poised for a repeat dose before too long.
The euro <EUR=> was down 0.01 percent at $1.4641 after
breaking above $1.47 for the first time since December 2009.
The benchmark 10-year U.S. Treasury note <US10YT=RR> was
down 13/32 in price to yield 3.36 percent.
The U.S. government reported orders for durable goods
increased 2.5 percent in March, greater than the 2.0 percent
rise expected in a Reuters poll of economists.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
Fed funds rate expectations: http://r.reuters.com/xyz48r
Fed QE timelines: http://r.reuters.com/faq98r
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
WORLD STOCKS FIRM
The Dow Jones industrial average <> was up 11.54
points, or 0.09 percent, at 12,606.91. The Standard & Poor's
500 Index <.SPX> was down 1.12 points, or 0.08 percent, at
1,346.12. The Nasdaq Composite Index <> was down 2.54
points, or 0.09 percent, at 2,845.00.
World stocks as measured by the MSCI all-country world
index <.MIWD00000PUS> pared earlier gains to slip 0.1 percent
to 351.58.
The FTSEurofirst 300 index <> of top European shares
rose 0.2 percent at 1,148.42, gaining ground for the fifth
session as investors focused on strong results from bellwethers
such as Ericsson <ERICb.ST> and Renault <RENA.PA>.
Aside from the ECB, Asian and Latin American central banks
have also been tightening monetary policy for some time.
The split in monetary policy has helped revive the "carry
trade," in which investors borrow in a low-yielding currency to
invest in higher-yielding assets or currencies.
Investors have been snapping up the high-yielding
Australian dollar <AUD=D4> -- against which the greenback hit a
29-year low on Wednesday following a big jump in Australian
inflation -- while China let the yuan <CNY=SAEC> rise to a
post-2005 revaluation high, triggering gains in emerging Asian
currencies.
SILVER LINING
Silver, the superstar commodity of the year, steadied from
a three percent fall on Tuesday, its biggest one-day loss in
six weeks, which followed Monday's rally to near record
levels.
Spot silver <XAG=> firmed slightly to $45.78 an ounce and
is on track for a 21 percent gain this month and a 47-percent
rise this year, making it the top performing precious metal.
Gold <XAU=> rose $4.45, or 0.30 percent, to $1511.40 an
ounce.U.S. light sweet crude oil <CLc1> rose 13 cents, or 0.12
percent, to $112.34 per barrel.
(Additional reporting by Naomi Tajitsu in London, Blaise
Robinson in Paris and Ian Chua in Sydney; Writing by Herbert
Lash)
