* Fed to end two-day meeting, statement eyed * U.S. GDP shows unexpected contraction in fourth quarter * Treasury to auction $29 billion of seven-year notes By Luciana Lopez NEW YORK, Jan 30 Prices for U.S. Treasuries traded near flat on Wednesday as data showed the U.S. economy unexpectedly shrank at the end of last year, with investors awaiting any hints about the Fed's asset-buying program as the central bank concludes a two-day meeting. Gross domestic product fell at a 0.1 percent annual rate, its first decline since the 2007-2009 recession as businesses scaled back on restocking and government spending plunged. "We have a slowing in government spending associated with the fiscal situation as well as some drawdown in military activity," said Terry Sheehan, economic analyst with Stone & McCarthy Research Associates in Princeton, New Jersey. "This report doesn't have immediate implications for Fed policy. They will be unhappy with it, but it's one quarter's number," Sheehan said. While the figure could see revisions in the months ahead, prospects for the new few quarters look "tricky," said Rob Carnell, an economist with ING Bank. "Recent Treasury yield increases and sell-offs in the back month Fed funds futures look premature," he said. "We will find better levels to lock in low rates in anticipation of higher yields in the second half of the year." Treasuries jumped after the data, but soon gave up those gains as investors turned toward Wednesday's other major event: the close of the Federal Reserve's two-day policy meeting. Investors will scour the bank's statement for any hints of unease with its asset-buying program. Suggestions along those lines in the December meeting minutes, released on Jan. 3, jump-started a selloff that took yields up out of their range of recent months. Further hints that the Fed might end its latest round of quantitative easing before the end of this year - or even trim the size of that program - could see more selling. Ten-year notes traded 1/32 lower to yield 2.003 percent early in the New York session, from 1.9973 percent late on Tuesday. Thirty-year bonds traded flat to yield 3.184 percent. Yields on benchmark 10-year notes have been testing the 2 percent level since Monday, breaching that figure for the first time since April. But yields didn't get traction above that level until Wednesday, helped by a bump in risk appetite in Asian trading overnight. Investors are also awaiting nonfarm payrolls data on Friday. The Fed wants the unemployment rate to drop closer to 6.5 percent from the current 7.8 percent. In addition, the Treasury will sell $29 billion of 7-year notes on Wednesday.