Financial markets appeared close to "nuclear meltdown" after the United States announced sweeping tariffs on April 2, European Central Bank policymaker Joachim Nagel said on Thursday, arguing this helped discipline the U.S. administration.

U.S. stocks, bonds and the dollar sold off after President Donald Trump's announcement, even raising questions among investors about the safe-haven status of the U.S. currency and government debt.

"Sometimes on certain days I had the feeling that we weren't far from a nuclear meltdown on financial markets," Nagel, who heads Germany's Bundesbank, told reporters on the sidelines of a G7 meeting in Canada.

Trump has since suspended or reduced some of those tariffs and Nagel suggested the market's "message" may have helped moderate the U.S. President's stance.

"Of course the U.S. side saw that too, and from my point of view, the message in April was so strong that it ultimately got through to everyone involved," Nagel, who sits on the ECB's Governing Council, added.

Source: Reuters