Canada's central bank lowered its interest rate by 25 basis points to three per cent on Wednesday, as the Bank of Canada governor warned there is little he can do to negate the economic impact of U.S.

The Bank observed underlying inflation is now close to its target of 2% and that it will remain around this target over the next two years. Should a trade war emerge with Canada’s largest trading partner, the United States, the Bank noted “a protracted trade conflict would most likely lead to weaker GDP and higher prices in Canada.”

Below are some key quotes from a news conference by Bank of Canada Governor Tiff Macklem and Senior Deputy Governor Carolyn Rogers on Wednesday after the central bank cut its key policy rate by 25 basis points to 3%.