World stock prices held near three-week highs and the dollar fell on Thursday as investors awaited whether the U.S. Federal Reserve will end its near-zero interest rate policy.

A poll by Reuters released on Wednesday showed the majority of economists now expect no hike later on Thursday, although it remains a close call. The futures market implied traders assigned a 1-in-4 chance of such a move.

"Investors are in wait-and-see mode," said Art Hogan, chief market strategist at Wunderlich Securities in New York. Mixed U.S. data on jobless claims, housing starts and regional manufacturing did little to change traders' view on the timing of the Fed's "lift-off." U.S. two-year Treasuries yield held below a near 4-1/2 year high.

Oil prices were marginally lower, while gold gave back a bit of Wednesday's gains. Traders had expected the Fed to raise rates for most of this year, but those expectations faded following a bout of global market turmoil this summer on worries about China.

As the Federal Open Market Committee, the Fed's policy-setting group, releases its policy statement at 2 p.m. (1800 GMT), it will put forth its quarterly Summary of Economic Projections (SEP), also referred to as "dot plots," that present individual forecasts of policymakers.

At 2:30 p.m. (1830 GMT), Fed Chair Janet Yellen will hold a news conference where she will likely face a barrage of questions on the central bank's policy stance and economic outlook.

The dot plots and Yellen's responses will likely stir wild swings across markets, analysts said. In early U.S. trading, the Dow Jones industrial average fell 10.79 points, or 0.06 percent, to 16,729.16, the S&P 500 declined 0.2 points, or 0.01 percent, to 1,995.11 and the Nasdaq Composite shed 8.01 points, or 0.16 percent, to 4,897.24.

The pan-European FTSEurofirst 300 index was little changed at 1,428.27. Tokyo's Nikkei index ended up 1.4 percent. The MSCI world equity index, which tracks shares in 45 nations, rose 0.2 percent to 399.64.

The dollar index, which tracks the greenback versus a basket of six currencies, fell 0.28 percent, to 95.151. Brent crude was last down 26 cents, or down 0.52 percent, at $49.49 a barrel. U.S. crude was last down 23 cents, or 0.49 percent, at $46.93 per ba
rrel. Spot gold prices fell 0.12 percent to $1,117.81 an ounce.

FED FOCUS

Despite a late dip 2 percent in volatile Chinese stocks , MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.6 percent to its highest level in three weeks.

Japan's Nikkei climbed 1.4 percent too while Australian and Malaysian shares rose 1 and 1.8 percent.

Even if the Fed were to raise rates, many market players expect officials to signal a dovish stance on the pace of future increas
es, rather than herald a brisk series of increases.

There is also the comfort that both the European Central Bank and the Bank of Japan appear to be gearing up for fresh rounds of stimulus and rates are still being cut in many parts of the world.

Switzerland's central bank left its policy of negative interest rates unchanged on Thursday as it seeks to weaken a "significantly overvalued" Swiss franc. It also predicted a deeper-than-expected bout of deflation due to low oil prices.

The oil price slumped between April and August but has since steadied and it was holding on to sharp gains made on Wednesday in early European trading.

U.S. West Texas Intermediate (WTI) crude futures were last at $47.21 per barrel, while Brent had dipped back to just under $50 a barrel.

The yield on the U.S. two-year note held near a 4 1/2-year high at 0.803 percent. Even if the Fed doesn't pull the trigger later it is still expected to by the end of the year.

Euro zone bond yields meanwhile were largely steady, as France and Spain faced the uncomfortable task of selling debt hours before the U.S. rate decision.

France plans to sell 7-8 billion euros of medium-term bonds, as well as 1.0-1.5 billion of inflation-linked debt. Spain is due to sell 4-5 billion of bonds maturing in up to 10 years.

"(The Fed meeting) could have a slightly dampening impact on demand and keep some investors sidelined," said KBC rate strategist Mathias van der Jeugt, who expects the Fed to hike rates but signal a very slow pace of future tightening.