The Bank of Canada held its key interest rate steady at 5% Wednesday, citing recent evidence that indicates the economy may be weakening.

The central bank says it decided not to raise its key rate given demand in the economy is slowing and previous rate hikes still need more time to take effect.

Forecasters largely expected Wednesday’s decision following recent data which showed the economy shrank in the second quarter, while the unemployment rate has been rising for three consecutive months.

The announcement comes after the Bank of Canada raised interest rates at its last two meetings, ending a previous pause on rate hikes.

In a news release Wednesday, the Bank of Canada said its governing council is still concerned about inflationary pressures and is ready to raise interest rates further if need be.

Canada’s inflation rate was 3.3% in July, ticking up from the previous month, and is expected to remain around 3% for the rest of the year.