17.01.201810:38:00UTC+00Bank Of Canada Warns On NAFTA But Raises Rates

The Bank of Canada on Wednesday raised its key interest rate by 0.25 basis points to 1.25%, as expected.

However, the BoC sounded its deepening concerns that a breakdown in trade relations with the U.S. and Mexico could de-rail the Canadian economy.

"Recent data have been strong, inflation is close to target, and the economy is operating roughly at capacity. However, uncertainty surrounding the future of Nafta is clouding the economic outlook," the BOC statement read.

"Some continued monetary policy accommodation will likely be needed to keep the economy operating close to potential and inflation on target." I