Source: Sharecast
In an interview with CNBC on Tuesday, Bailey said: "I do see some underlying weakening, particularly in the labour market - and the labour market is softening."
"Although we've got pay increases that are well over a level consistent with target, all the sense I have [...] is they are beginning to come down. That's the key judgment."
Regarding the BoE's next policy meeting decision, Bailey simply said: "Well we'll see."
On international geopolitics, he said the world is in "unchartered territory" with America's tariff-fuelled trade war. "You can't use history so easily to judge what's going to happen," he said.
"That increase in uncertainty and unpredictability is definitely coming through in terms of activity and growth. When I go around the country talking to businesses, which I do a lot, what they tell me is that they are putting off investment decisions."
The central bank voted to keep rates unchanged at its meeting last month, and projected that consumer price inflation would remain "broadly at current rates" – the annual rate of inflation was 3.4% in May – for the rest of the year before falling back down towards the 2% target next year.