TORONTO (AP) — Canada’s central bank declined to raise its benchmark interest rate on Wednesday and said the highly contagious omicron coronavirus variant is weighing on the economy.

The Bank of Canada said that looking ahead, it expects interest rates will need to increase as it expects economic growth to bounce back. The bank is keeping its key overnight interbank interest rate target on hold at 0.25%. It said inflation expectations have moved up in the short term.

The announcement comes ahead of a announcement by the U.S. Federal Reserve.