(Eagle News) — As expected Canada’s central bank hiked its key interest rate Wednesday by 25 basis points to .50%.

The bank has been signalling for some time now interest rate increases were on the way.

Added to the problem of inflation, is the war in Ukraine.

“The unprovoked invasion of Ukraine by Russia is a major new source of uncertainty. Prices for oil and other commodities have risen sharply,” the bank said in a statement Wednesday. “The situation remains fluid and we are following events closely.”

Economists were not surprised by today’s announcement.

“January’s inflation print was in line with the BoC’s forecast but further gains are likely in the near-term given rising food and energy commodity prices related to the Russia-Ukraine conflict,” economist Josh Nye wrote in an RBC newsletter.

Can Canadians expect another increase next month”

“At this early stage, we don’t think geopolitical developments preclude a follow-up hike in April, nor do they argue for the more aggressive tightening path that markets continue to price,” Nye said. Inflation in January was at 5.1%.