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June 18 (Reuters) - European shares were subdued on

Wednesday ahead of the U.S. Federal Reserve's monetary policy

decision, while persisting Middle East tensions also kept

investors on edge.

The pan-European STOXX 600 index was steady at

541.98 points, as of 0705 GMT.

Investors awaited the Fed's monetary policy meeting, where

interest rates are widely expected to remain unchanged, while

comments from policymakers will be closely monitored to gauge

how the U.S. central bank intends to navigate an uncertain trade

environment.

U.S. President Donald Trump's shifting tariff policy has

caused turmoil in financial markets in recent months, with

little progress on trade deals as the July 8 pause deadline

approaches.

Adding to this uncertainty were tensions between Iran and

Israel, after they launched new missile strikes at each other

despite Trump calling for Tehran's "unconditional surrender".

In the regional market, the insurance sector and

construction and material stocks led the gains, though

overall advances were tempered by declines in heavyweight

healthcare shares.

Among stocks, Airbus gained 1.7% after the

planemaker raised the upper range of its dividend payout target

ahead of a business update.

Data showed that British inflation eased as expected in May,

but is unlikely to influence the central bank's decision later

this week.