Canadian interest rates could rise again if inflation continues to increase, says Bank of Canada Governor Tiff Macklem.

In a speech to the Calgary Chamber of Commerce on Thursday, Macklem said higher interest rates are helping to cool demand and return inflation to the central bank’s 2% target. But the central bank remains concerned about underlying inflationary pressures.

Therefore, the bank may need to increase interest rates again if the inflationary pressures persist.

Macklem’s comments came one day after the bank held its benchmark interest rate at 5% after five increases in as many months. Another BoC rate hike would have implications for the commercial real estate industry as nervous investors and developers seek interest-rate stability and lending-cost certainty.

Commercial real estate investment has waned across Canada this year as rising interest rates continue to erode investor and developer confidence.

The BoC’s stance contrasts with Statistics Canada’s finding that mortgage-interest costs are driving inflation, which stood at 3.3% in July.