Stock market today: S&P 500 falls as government shutdown, trade jitters persist
Investing.com -- Bank of England policymaker Alan Taylor warned on Tuesday that Britain’s economy faces an increasing risk of a "bumpy landing" with inflation potentially falling below target, partly due to the impact of U.S. President Donald Trump’s trade tariffs.
Speaking at King’s College University, Taylor predicted that the current rise in British inflation would fade in 2026. He suggested that Trump’s tariffs would more likely harm economic growth rather than increase prices, as exports rejected from the U.S. market would be diverted to other countries.
Taylor outlined a scenario where UK inflation could drop below the BoE’s 2% target in late 2026, with the economy entering a prolonged period of weakness.
"Part of this scenario, in my mind, could end up resulting from some of the trade diversion pressures that I have described today: if we underestimate the forces of trade diversion washing up on our shores in the next year or two, our inflation forecast will miss the mark," he said.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.