By Andrew Galbraith
SHANGHAI, Sept 28 (Reuters) - Shares in Asia inched higher on Friday, following gains on Wall Street overnight after news of robust U.S. economic growth, with the chairman of the Federal Reserve saying the United States does not face a large chance of near-term recession.
MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS was up 0.02 percent in early trade in Asia. Australian shares .AXJO were 0.5 percent higher, while Seoul's Kospi .HS11 was down 0.5 percent after hitting three-month highs on Thursday.
Japan's Nikkei stock index .N225 gained 1.1 percent, putting it within sight of a 2018 high of 24,129.34 points on Jan. 23.
The Dow Jones Industrial Average .DJI rose 0.21 percent to 26,439.93 on Thursday, the S&P 500 .SPX gained 0.28 percent to 2,914 and the Nasdaq Composite .IXIC added 0.65 percent to 8,041.97.
S&P E-mini futures ESc1 edged higher to 2,921.5 on Friday.
After the Fed raised rates on Wednesday, the third time this year, Fed Chairman Jerome Powell said on Thursday that the U.S. does not face a large chance of a recession in the next two years and the Federal Reserve plans to keep gradually raising interest rates. Citi analysts cautioned in a note that not all data was reassuring.
"The Citi US Economic Surprise Index has been pushed into negative territory by disappointing housing data in the United States," they wrote.
"The latest data confirms that the housing market continues to be less than ideal. Pending home sales, a leading indicator, declined to the lowest level in seven months."
Pending home sales fell 1.8 percent month-on-month versus consensus expectations for a 0.5 drop, they said.
The bullish outlook for the U.S. economy continued to lift the dollar, which rose 0.04 percent against the yen to 113.4 JPY= after touching a 2018 high of 113.46 on Thursday.
The single currency EUR= was down 0.04 percent on at$1.1636, and faces more pressure after Italy's government on Thursday defied EU requirements that it cut its deficit, targeting a budget deficit at 2.4 percent of gross domestic product for the next three years.
Markets had expected Italy's economy minister, Giovanni Tria, to resist a spending push by Italy's coalition government, which took power in June. dollar index .DXY , which tracks the greenback against a basket of six major rivals, was up 0.1 percent at 95.003.
U.S. Treasury yields ticked lower. The yield on benchmark 10-year Treasury notes US10YT=RR was at 3.0462 percent on Friday, compared with its U.S. close of 3.055 percent on Thursday.
The two-year yield US2YT=RR , closely tied to expectations of higher Fed fund rates, touched 2.831 percent compared with a U.S. close of 2.835 percent.
U.S. crude CLc1 was 0.03 percent higher at $72.14 a barrel. Brent crude LCOc1 fell 0.1 percent to $81.63 per barrel.
Gold was slightly higher after tumbling 1 percent on Thursday on strength in the U.S. dollar, which made bullion more expensive for buyers using other currencies. Friday morning, spot gold XAU= was up 0.1 percent at $1,183.48 per ounce. GOL/
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