(Updates with closing levels, details)
* FTSEurofirst 300 down 0.1 pct, Euro STOXX 50 up 0.1 pct
* Italian stocks trim recent sharp gains
* UK insurers hurt by budget measures
* Spain's IBEX outperforms as Inditex reassures
PARIS, March 19 (Reuters) - European shares held steady on Wednesday, although Italian stocks slipped in strong volumes as Prime Minister Matteo Renzi said the European Union's budget deficit limit of 3 percent of economic output was outdated.
Shares in UK insurers also dropped, hurt by government plans to scrap a requirement that pension savings be used to buy an annuity. Legal & General was down 8.4 percent and Aviva down 5.1 percent after UK finance minister George Osborne announced the plans as part of the UK budget.
Miners lost ground again, with Antofagasta down 5.3 percent, falling along with copper which hit its lowest level in more than 3-1/2 years on Wednesday on worries about weaker growth and tighter credit in China.
The FTSEurofirst 300 ended 0.07 percent lower, at 1,305.14 points, while the euro zone's blue-chip Euro STOXX 50 index added 0.08 percent at 3,076.36 points.
Milan's benchmark index FTSE MIB fell 0.3 percent in volumes more than twice the daily average volume of the past three months, trimming recent lofty gains, with Generali , UniCredit and Telecom Italia down 0.8-1.1 percent.
Renzi told the Italian parliament on Wednesday the EU's current budget ceiling "is, objectively, an anachronistic parameter," adding however that he would respect Italy's pledges to remain within the limit. The EU Commission had expressed concern that Italy would overshoot.
Despite the day's dip, the MIB is still up 11 percent in 2014, strongly outpacing the broad FTSEurofirst 300 which is down 0.9 percent year-to-date, as investors bet on recovery from Italy's worst recession in 70 years.
"There's been a strong outperformance of the Italian market in the past few weeks, the market has been very resilient throughout the Ukrainian crisis, so it's logical to have a bit of profit taking today after such a rally," said Andrea Tueni, sales trader at Saxo Banque.
Bucking the trend, Spain's IBEX rose 0.4 percent, with Inditex surging 4.9 percent after the world's biggest fashion retailer posted strong sales so far this year and announced a pick-up in store openings.
Overall, investors avoided taking significant bets while the U.S. Federal Reserve is meeting. Analysts said a further cut in the central bank's monthly bond purchases by $5 billion was largely factored in, and the market would look for hints about the speed of future cuts and whether the Fed provides new guidance on when it might eventually raise interest rates.
"There is always some nervousness ahead of the Fed meeting. We expect the tapering process to continue and there is likely to be some guidance around the unemployment rate and future U.S. rate rises, although we still don't expect the first rate hike until July 2015," Barclays Wealth strategist Henk Potts said.
Europe bourses in 2014: link.reuters.com/pad95v
Asset performance in 2014: link.reuters.com/rav46v
Today's European research round-up (Additional reporting by Atul Prakash in London; Editing by Hugh Lawson/Ruth Pitchford)