UPDATE 2-UK stocks dip from recent highs as the Fed takes focus

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* Miners drag FTSE 100

* SSP group slumps on grim outlook

* FTSE 100 down 0.6%, FTSE 250 off 1.0% (Updates to close)

March 17 (Reuters) - British stocks ended lower on Wednesday, retreating from recent highs as investors awaited the U.S. Federal Reserve’s latest policy statement for clues about the central bank’s stance on interest rates and inflation.

The blue-chip FTSE 100 index was down 0.6% after posting a more-than two-month closing high on Tuesday, with mining stocks weighing the most.

The domestically focused, mid-cap FTSE 250 index fell 1.0% from a near 13-month peak, dragged down by consumer discretionary and real estate stocks.

“People are just waiting to see what the Federal Reserve and the Bank of England will say before they decide whether to invest more money or not,” said Chris Bailey, strategist at Raymond James.

“The same debate is going to happen with the Bank of England tomorrow in terms of will interest rates go up. I think they will accept higher inflation rates, ultimately bond yields will go up, and therefore pricing power and good balance sheets will matter more for investors in individual shares.”

Bank of England Governor Andrew Bailey had said on Monday that a recent rise in interest rates in financial markets was consistent with an improvement in the economic outlook.

While optimism about a British economic recovery has seen the midcap index trading close to highs achieved before the coronavirus pandemic, the FTSE 100 has fallen behind due to its sensitivity to international markets, particularly commodity prices, the sterling and U.S. treasury yields.

BT Group jumped 6.5%%, topping the FTSE 100 after its mobile and internet service provider EE won a new 5G spectrum in an auction.

Retail investment platform Hargreaves Lansdown rose 1.5%, after it forecast profit for the year ending June 30 to be “modestly” above analyst estimates.

Upper Crust owner SSP shed 7.9%, after it warned that revenue from its train and bus station businesses would not recover to pre-pandemic levels before 2024. (Reporting by Shivani Kumaresan and Amal S in Bengaluru; editing by Uttaresh.V and Rashmi Aich; Editing by Mark Heinrich)