Taylor believes Hughes is proving himself a smart operator in the transfer market and that City's owners must be pleased.
In his column for the Daily Express, Taylor wrote: "He is doing a very good job, ably helped by his assistant Mark Bowen.
"Recruiting the right kind of players is vital, because if they are not right, then sooner or later they will get you the sack. The change-over Hughes made ... has generally been good, but this is going to be a continuous evolution, and it is impossible to get every transfer right."
Taylor also said: "For the first time in many years Manchester can boast both of its clubs vying for positions at the top end of the Premier League. United are used to it. City can join them providing they keep a stable management team."