TORONTO: The Canadian dollar weakened against its US counterpart on Friday, giving back some of this week's gains, as new pandemic curbs in China weighed on oil prices and data added to evidence of Canada's economy slowing in December.

Canadian retail sales jumped by 1.3% in November, much more than expected, but preliminary figures for December suggest a sharp drop as novel coronavirus restrictions were re-imposed, Statistics Canada said.

US crude oil futures were down 2.4% at $51.87 a barrel on worries that restrictions in China, the world's biggest oil importer, to contain a fresh wave of COVID-19 will crimp demand. Oil is one of Canada's major exports.

Global shares slipped off record highs as data showed economic activity in the euro zone shrinking markedly in January, while the Canadian dollar was trading 0.5% lower at 1.2700 to the greenback, or 78.74 US cents.

It traded in a range of 1.2633 to 1.2716, having touched on Thursday a near three-year high at 1.2590.

For the week, the loonie was on track to gain 0.3% as investors bet on hefty US stimulus from newly inaugurated President Joe Biden and the Bank of Canada opted against cutting interest rates.

Canadian government bond yields were lower across a flatter curve in sympathy with US Treasuries. The 10-year fell 1.7 basis points to 0.856%, pulling back from a 10-month high intraday on Thursday at 0.892%.