The Bank of Canada is sticking with its trendsetting interest rate of 0.5 per cent, saying uncertainties continue to overshadow the economy's stronger-than-expected start to the year.

In explaining its decision Wednesday to hold the rate, the central bank once again highlighted weak wage growth and the softening rate for underlying inflation as examples the economy still has room for improvement.

The bank's scheduled rate announcement comes after it raised its 2017 growth projection last month following a surprisingly healthy start to the year in areas such as employment, consumer spending and the housing markets. In Wednesday's statement, the bank added better business investment numbers to the list.

"Recent economic data have been encouraging,'' the bank said.

"Consumer spending and the housing sector continue to be robust on the back of an improving labour market, and these are becoming more broadly based across regions.''

The bank's statement, however, also predicted that the ``very strong growth'' over the first three months of the year will be followed by some moderation in the second quarter, even though at the same time it expects the U.S. economy to rebound.