European stocks steady after reassurance from US Fed

August 30, 2021: European stocks nudged higher at the open Monday following US Federal Reserve chief Jerome Powell's cautious comments on potential withdrawal of its massive stimulus programme later this year.

Germany's DAX index of leading shares was close to flat soon after 9:00 am (0700 GMT), at 15,856.71 points, while the Paris-based CAC 40 index added 0.1 percent to 6,690.28.

Trading was closed in London due to a public holiday.

On Friday, Powell had said that "it could be appropriate to start reducing the pace of asset purchases this year" from the current $120 billion per month pace at the US central bank.

But any move to slow asset purchases would still leave a large amount of stimulus in place, and would not be a signal that an increase in the benchmark lending rate would soon follow, he added.

"Powell kept his much-awaited remarks in Jackson Hole to a minimum... he went on tip-toes" which has reassured markets, said analyst Veronique Riches-Flores of Riches Flores research.

Later Monday, eyes will turn to August inflation data for Germany, the eurozone's largest economy, ahead of a next week's meeting of European Central Bank policymakers.

ECB chief Christine Lagarde last month promised sustained support for the single currency zone, saying that the impact of the Delta variant on the economy justified keeping stimulus in place until at least early next year.

AFP/APP