* U.S. central bank signals no imminent new policy stimulus * Fed sticks to near zero rate policy due to unemployment * Strong demand for $35 bln in new five-year notes * U.S. durable goods post biggest drop in 3 years By Richard Leong NEW YORK, April 25 (Reuters) - U.S. Treasury debt prices fell o n W ednesday after the Federal Reserve showed no sign it was in hurry to embark on a third big bout of bond purchases to stimulate the U.S. economy, even as unemployment remains high. The decline in bond prices was mitigated by strong demand at a $35 billion auction of new five-year supply, part of this week's $99 billion in coupon-bearing securities, analysts said. Traders and investors will turn to the Fed's economic staff release of its updated economic predictions at 2 p.m. (1800 GMT), followed by Fed Chairman Ben Bernanke's press conference at about 2:15 p.m. (1815 GMT) following the conclusion of this week's two-day policy meeting. "We sold off a bit in reaction to the Fed statement. Now people are waiting for the economic forecasts and see what they could infer from them," said Jim Vogel, interest rate strategist at FTN Financial in Memphis, Tennessee. The bond market's losses after the latest statement from the Federal Open Market Committee were muted compared with its reaction to the previous one. On March 13, Treasuries prices began to tumble after the U.S. central bank modestly upgraded its outlook on the U.S. economy and offered no hint it was not about to engage in a third round of quantitative easing, dubbed QE3. In a week, the 10-year yield jumped to 2.40 percent, a near five-month high. Subsequently, some disappointing U.S. economic data, together with renewed contagion fears from the euro zone debt crisis, knocked benchmark yields below 2.00 percent. The government earlier on Wednesday reported durables goods orders fell 4.2 percent in March, their biggest monthly drop in three years, as a result of a decline in aircraft demand and as global growth slows. Earlier, investors received the sobering news that the British economy contracted again in the first quarter, marking its second recession since the worldwide financial crisis more than three years ago. On slightly above average volume, benchmark 10-year notes last traded down 7/32 in price, yielding 2 percent, up 3 basis points from late on Tu esday. The 10-year yield flirted with a two-month low on Mon day on worries about possible political upheaval in France and the Netherlands. The 30-year bond was down 19/32 in price to yield 3.16 percent, up 3 basis points from Tuesday's close. Bond prices were briefly unchanged on a wave of buying after strong demand at the five-year note auction. STRONG FIVE-YEAR SALE After a mediocre two-year auction on Tuesday, the latest five-year note sale commanded surprisingly keen interest from foreign central banks and other indirect bidders. These five-year securities due in April 2017 cleared at a yield of 0.887 percent, slightly below traders' expectations. The yield was slightly above the record auction low of 0.880 percent set back in December. The overall bidding was the strongest in three months. "Every auction statistic was encouraging," FTN's Vogel said. The Treasury Department will complete this week's auctions with a $29 billion offering of new seven-year debt on Th ursday at 1 p.m. (1700 GMT). In "when-issued" trading, the new seven-year issue was expected to yield 1.4130 percent early Wednesday afternoon, below the high yield of 1.5900 percent set at the March auction.