(Bloomberg) -- Bank of England Deputy Governor Jon Cunliffe said there’s a risk that the war in Ukraine leads to inflation undershooting the U.K. central bank’s goal, although policy may still need to be tightened.

The member of the BOE’s Monetary Policy Committee said officials need to be more vigilant in watching what impact commodity prices will have on the economy, though for now he said there’s not much evidence of persistently higher inflation expectations.

The remarks help explain why Cunliffe alone on the nine-member MPC voted to keep rates unchanged last month when the rest of his colleagues voted for a third increase in the benchmark lending rate.

“While I recognize the risk of second-round effects and that further tightening of monetary policy might be necessary, I am not at present convinced that we will inevitably have to lean heavily and constantly against an embedding of an inflationary psychology as we progress through this challenging period and as the impact of higher commodity prices on real household incomes depresses activity,” Cunliffe said in the text of a speech delivered at the European Economics & Financial Center on Monday.

He also said: 

• “I do not think we are yet seeing a psychology of persistently higher inflation emerge.”
• It’s not certain the economy is headed back toward the inflation and shocks suffered in the 1970s
• There’s little monetary policy can do about short term inflationary pressures that are externally generated
• The main driver of pay growth has been tightness in the labor market
• Main risk to the banking system is through higher and more volatile commodity prices

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