We will have to wait at least a few more weeks before interest rates start going down in Canada.

The Bank of Canada is leaving its key interest rate unchanged at five per cent, officials announced Wednesday.

Governor Tiff Macklem said while economic growth has remained weak, they have continued concerns with inflation.

“Recent inflation data suggest monetary policy is working largely as expected,” Macklem said during a news conference.

“But future progress on inflation is expected to be gradual and uneven, and upside risks to inflation remain.”

Consumer price index inflation eased to 2.9 per cent in January, largely reflecting lower energy prices and an easing in food price inflation,

But the bank’s governor said shelter price inflation remains elevated and is still the biggest contributor to overall inflation.

“Our preferred measures of core inflation eased in January but remain above three per cent on a year-over-year and three-month basis,” said Macklem.

“As well, the share of CPI components rising faster than three per cent declined but is still above the historical average.”

Macklem said they want to see a further deceleration in core inflation over the coming months before they consider lowering interest rates.

The Bank of Canada expects inflation to be close to three per cent through the middle of the year before easing in the second half.