TORONTO: The Canadian dollar weakened against its US counterpart on Thursday, extending its pullback from a seven-week high the day before, as oil prices fell and investors awaited a Bank of Canada report on risks to the stability of the financial system.

The loonie was down 0.2% at 1.2580 to the greenback, or 79.49 US cents, after trading in a range of 1.2550 to 1.2588. On Wednesday, it touched its strongest intraday level since April 21 at 1.2515.

The BoC’s annual Financial System Review, due at 10 a.m. ET (1400 GMT), could provide an update on Canadian household vulnerabilities as the central bank races ahead with a series of oversized interest rate hikes to curb inflation. Canada has the highest level of household debt in the G7.

The price of oil, one of Canada’s major exports, dipped after parts of Shanghai imposed new COVID-19 lockdown measures although China’s stronger-than-expected exports in May offered a boost to the demand outlook.