GLOBAL MARKETS-Stocks dip, bond yields up following U.S. Fed statement
* U.S. Fed revamps rates guidance, trims bond buys further
* Wall Street turns lower following Fed statement
* Treasuries fall, yields higher (Updates with U.S. Fed statement)
By Angela Moon
NEW YORK, March 19 (Reuters) - The world's major stock markets dipped while yields on U.S. Treasuries rose on Wednesday after the Federal Reserve dropped the unemployment rate as its definitive yardstick for gauging the U.S. economy's strength and made clear it would rely on a wide range of measures in deciding when to raise interest rates.
At the same time, the U.S. central bank said dropping a promise to hold rates steady "well past the time" the U.S. unemployment rate falls below 6.5 percent did not indicate any change in the Fed's policy intentions.
Wall Street reacted with a modest selloff with major indexes falling to session lows shortly after the statement from the Fed's latest policy meeting.
"This statement from the Fed is as hawkish as it gets - the only thing they did not do is (raise) rates today. The Fed is at neutral now and expect rate hikes to begin sometime in early 2015," said Thomas di Galoma, head of fixed-income rates at ED&F Man Capital Markets in New York.
The benchmark 10-year Treasury notes yield rose 7.5 basis points to 2.753 percent while the 5-year notes yields surged 12 basis points to 1.67 percent.
The 3-year Treasuries yields rose 10.5 basis points to 0.862 percent, the highest level since January.
In the currency market, the euro and the yen extended losses against the dollar.
The central bank proceeded with its well-telegraphed reductions to its massive bond-buying stimulus, announcing it would cut its monthly purchases of U.S. Treasuries and mortgage-backed securities to $55 billion from $65 billion.
On Wall Street, the Dow Jones industrial average fell 48.79 points or 0.3 percent, to 16,287.4, the S&P 500 lost 4.43 points or 0.24 percent, to 1,867.82 and the Nasdaq Composite dropped 11.02 points or 0.25 percent, to 4,322.293.
The FTSEurofirst 300 edged down 0.03 percent, at 1,305.68 points, while the euro zone's blue-chip Euro STOXX 50 index was up 0.2 percent at 3,078.78 points. (Editing by Chizu Nomiyama)