LONDON — European markets closed lower on Friday after U.S. Federal Reserve Chairman Jerome Powell warned of "some pain" ahead in the fight against inflation.
European markets
The pan-European Stoxx 600 provisionally ended down 1.7% following the comments at the central bank's Jackson Hole economic symposium. All sectors turned red in afternoon trade, with retail and travel and leisure stocks sliding the most, down 3.5% and 3.4%, respectively.
Powell on Friday reiterated his commitment to halting inflation, warning that he expects the Fed to continue raising interest rates in a way that will cause "some pain" to the U.S. economy.
He added that the bank will "use our tools forcefully" to attack inflation, which is still running near its highest level in more than 40 years.
While some investors were hopeful of comments pointing toward a future dovish pivot, many analysts expected the chairman to adopt a hawkish tone and reiterate the Fed's commitment to dragging inflation back toward the target.
U.S. stocks turned negative following Powell's comments, with the Nasdaq shedding 2.5% in late-morning trade. Meantime, shares in Asia-Pacific ended higher Friday afternoon.
Back in Europe, U.K. energy regulator Ofgem announced its latest increase in the country's energy price cap, offering a bleak insight into the path of the deepening cost-of-living crisis and the U.K. inflation outlook.