Source: Sharecast
In an interview with the Financial Times on Friday, Alan Taylor argued that April’s surprise uptick in the consumer price index - from 2.6% to a year-high of 3.5% - was caused by one-off factors, and said he remained "pretty concerned" about the growth outlook for the economy.
The member of the Monetary Policy Committee acknowledged there had been some "welcome" developments in trade.
But these only affected a small part of UK trade, he argued, and that Donald Trump’s sweeping global tariff regime remained a threat.
Taylor told the newspaper: "I am seeing more risk piling up on the downside scenario because of global developments", with the impact of tariffs on imports "building up over the rest of the year in terms of a trade diversion and drag on growth."
The nine-strong MPC lowered the cost of borrowing earlier this month to 4.25%, the second reduction this year and the fourth in the current rate-cutting cycle.
While the cut was widely expected, the tightness of the vote surprised many.
Five members voted for the 25 basis point cut. But two, including chief economist Huw Pill, argued that rates should be left on hold because of persistent inflation, while Taylor and fellow external member Swati Dhingra backed a larger 50 bps reduction, to 4%.
Asked if he would be in favour at another cut at June’s meeting, Taylor said: "I’m not going to pre-emptively announce my vote, but I think I indicated in my dissent that I thought we needed to be on a lower [monetary] path."