"We couldn't get any momentum and well done to England - they restricted us well. The scoreline flattered us a little; it was the batting which let us down," said Bailey, who was the top-scorer with a 55 off 69 balls for Australia.
"It was a batting wicket but it slowed in the end. If it continues to be dry, we need to consider a spinner.
"We need to get the balance right, we need to get partnership going, that needs to be addressed. We have to turn around things," added Bailey, whose team was restricted to 221-9 while chasing 270 to win.
"From 1 for 170 we did a really job to pull it back with the ball," he said.
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Asked about James Faulkner, who scored an unbeaten 54 down the order, Bailey said: "James Faulkner is a very good cricketer and every time he gets challenged he steps up and adapts quickly."
England skipper Alastair Cook said it was an allround performance which helped his team to notch up a comprehensive 48-run victory over Australia and start their Champions trophy campaign on a perfect note at Edgbaston here.
The English team were 188 for two at one stage but a mini-collapse stopped their run flow and skipper Cook said they should have crossed the 300-mark.