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* Fed policy statement expected at 2 p.m. ET
* Dow up 0.06%, S&P off 0.03%, Nasdaq down 0.07% (Updates to early afternoon)
By Shreyashi Sanyal
June 19 (Reuters) - Wall Street's main indexes took a pause on Wednesday, after a rally the previous day, as investors held back from making big bets ahead of the Federal Reserve's policy statement that is expected to lay the groundwork for future interest rate cuts.
Markets have climbed this month, with the S&P 500 index gaining 6% so far and 1% away from its all-time high hit in early May, fueled by hopes of a rate cut.
The Fed's statement and new economic projections are scheduled to be released at 2 p.m. ET (1800 GMT), providing investors an opportunity to gauge the impact of a prolonged U.S.-China trade conflict, President Donald Trump's continued demands for a rate cut and softer-than-expected economic data on monetary policy.
The U.S. central bank will likely leave rates unchanged, but the market is factoring in a cut as soon as next month. Fed Chairman Jerome Powell will hold a press conference at 2:30 p.m. ET (1830 GMT).
"There is a sense of caution, investors are not willing to take too much risk because there seems to be so much ambiguity on whether there is going to be a rate cut or hike in this meeting," said Matt Ruffalo, senior strategist at Clarfeld Financial Advisors.
"It is very important for Powell to be balanced in his comments and not tip the scale in any direction. More so, investors are focused on what course of policy action needs to be taken going forward."
U.S. Treasury yields rose on Wednesday, tracking the European market, after steep falls the previous day, as investors rebalanced positions ahead of the Fed decision.
The financial sector gained 0.49%, with bank stocks rising 0.53%.
At 12:53 p.m. ET the Dow Jones Industrial Average was up 14.70 points, or 0.06%, at 26,480.24 and the S&P 500 was down 0.77 points, or 0.03%, at 2,916.98.
The Nasdaq Composite was down 5.34 points, or 0.07%, at 7,948.54.
The healthcare sector rose 0.41%, helped by gains in UnitedHealth Group Inc, Pfizer Inc and Allergan Plc.
Allergan jumped 5.64% after the drugmaker said its constipation drug, jointly developed with Ironwood Pharmaceuticals Inc, improved symptoms in patients suffering from irritable bowel syndrome with constipation.
Adobe Inc gained 4.63% after the Photoshop software provider beat analysts' estimates for quarterly profit and revenue.
Advancing issues outnumbered decliners for a 1.03-to-1 ratio on the NYSE and a 1.11-to-1 ratio on the Nasdaq.
The S&P index recorded 19 new 52-week highs and two new lows, while the Nasdaq recorded 44 new highs and 50 new lows. (Reporting by Shreyashi Sanyal and Aparajita Saxena in Bengaluru; Editing by Sriraj Kalluvila and Shounak Dasgupta)