The president of European Central Bank (ECB) has said that proposed US tariffs will "unsettle the trade world as we know" it ahead of their implementation later today (2 April).

Speaking on The Pat Kenny Show on Newstalk, Christine Lagarde said that the sweeping tariffs being enacted by US President Donald Trump on what he calls 'Liberation Day' will "not be good for those who inflict the rates and all those who retaliate".

The White House is expected to announce details of the tariffs this evening.

Since entering office in January, Trump has affected tariffs of 25% on imports of steel, aluminium and motor vehicles as well as more general tariffs on goods coming to the US from Canada, Mexico (both 25%) and China (10%).

Asked if Europe should respond with retaliatory tariffs, Lagarde said: "That is something for the political leaders to decide.

"Our job at the central bank is to anticipate, to explain to them ... what the consequences will be in terms of economic impact, and I was going to say negative impact, because it will be negative.

"Anyway, the world over, and it will have an impact, and the density and the durability of the impact will vary depending on the scope, on the products targeted, on how long it lasts, on whether or not there are negotiations, because, let's not forget, quite often those those escalation of tariffs, because they prove harmful, even for those who inflict them, lead to negotiation tables where people actually sit down and discuss and eventually remove some of those barriers."

Lagarde reiterated comments she made earlier this week that US hostility towards Europe in the form of tariffs marks the beginning of the continent's "march towards independence," and that Europe should focus on strengthening its capabilities in defence, trade and finance.

Specifically, she believes it could be a catalyst to create a consolidated European capital market and European payments infrastructure independent of market leaders such as Visa and Mastercard and tech giants like Apple and Google.

Lagarde noted "a lot less excitement" for investing in the US than prior to Trump's return to power, that investors have paused activity until there is "more certainty," and that the EU and the eurozone has to ensure it is attractive to investors to take advantage.

"We have to make sure that in the European Union, in the euro area, we have attractive investments that people want to put their money in, and we have the assets, we have the opportunities to do that," she said.

"If we were to remove the internal barriers that we have set for ourselves in Europe, our economic wealth would increase significantly.

"The IMF has produced some studies about that, and it's clear that our own barriers internally, at the moment, in services, for instance are equal to 110% tariffs. In goods equal to 40% tariffs. We have to remove that."

Asked about political resistance to such efforts from eurosceptic leaders within the EU, Lagarde said she believes that "European leaders who are truly dedicated to that European project will find the ways institutionally to agree amongst themselves, whether it takes the form of a coalition of the willing of qualified majority or otherwise, but they have to find the ways."

Lagarde is in Dublin to receive the Sutherland Leadership Award from Business & Finance and KPMG at a gala dinner at UCD this evening which will be attended by over 600 international business, political, and social leaders.

Photo: Christine Lagarde, president of the European Central Bank. (Pic: Liesa Johannssen/Bloomberg via Getty Images)