* Fed's policy committee to start two-day meeting
* CPI, housing starts data on tap
* Futures up: Dow 31 pts, S&P 1.4 pts, Nasdaq 5 pts
By Rodrigo Campos
NEW YORK, June 18 (Reuters) - U.S. stock index futures edged higher on Tuesday, trading in a tight range ahead of the start of a highly anticipated Federal Reserve meeting and before inflation and housing market data.
The Fed's policy-setting Federal Open Market Committee starts a two-day meeting Tuesday and markets are on tenterhooks as traders try to anticipate the Fed's timeline for winding down a bond-buying program that has been fundamental for price moves in various markets.
Speculation over the meeting has shaken markets significantly after Fed Chairman Ben Bernanke said in May the Fed could scale down its stimulus if the U.S. economy gains momentum, comments that brought the equities rally to a halt.
Inflation and housing market data expected before the opening bell will help traders gauge the Fed's maneuvering space ahead of the meeting.
"We're still thinking the Fed worries somewhat about deflation and that's why CPI is so important," said Kim Forrest, senior equity research analyst at Fort Pitt Capital Group in Pittsburgh.
"People are expecting housing starts to be up strongly, and that could lift markets, but they're mostly going to sit around and wait for the Fed to announce something tomorrow," she said.
S&P 500 futures rose 1.4 points and were above fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures rose 31 points, and Nasdaq 100 futures added 5 points.
Boeing launched a larger version of its flagship Dreamliner aircraft at the Paris Airshow on Tuesday, sharpening the battle with rival Airbus in the market for fuel-efficient, long-distance jets. Boeing shares ticked up 0.4 percent in light premarket trading.
U.S.-traded shares of Sony rose 3.7 percent to $21.49 as New York-based hedge fund Third Point said it has raised its stake in the Japanese company and urged its leadership to create an independent board to run a partially spun-off entertainment arm.
The Labor Department releases its May Consumer Price Index (CPI) at 8:30 a.m. EDT (1230 GMT). Economists in a Reuters survey expect a 0.2 percent rise compared with a 0.4 percent drop in April. Excluding food and energy, CPI is seen up 0.2 percent compared with a 0.1 percent rise in April.
Also at 8:30 a.m. (1230 GMT) the Commerce Department releases housing starts and permits for May. Economists forecast a 950,000 annualized rate in May versus 853,000 in April.