-The Bank of Canada on Wednesday cut its benchmark rate for a sixth straight time, and warned of a significant shock to the economy from a U.S.-Canada trade conflict with tariffs of up to 25%.

Canada’s central bank lowered its policy rate by a quarter-point to 3%, as widely expected in a survey of economists last week by The Wall Street Journal. In its decision, the Bank of Canada said a recent rebound, fueled by aggressive rate cuts since last June, is in jeopardy should President Trump follow through on his threat of a 25% tariff on imports from Canada and Mexico. Canadian officials have vowed to retaliate forcefully with tariffs of their own.

“A long-lasting and broad-based trade conflict would badly hurt economic activity in Canada,” Gov. Tiff Macklem said, adding tariffs would also push prices higher.