* Canadian dollar weakens 0.3% against the greenback * Loonie trades in a range of 1.2726 to 1.2799 * Canadian housing starts fall 12.2% in December * Canada"s 10-year yield rises 1.8 basis points By Fergal Smith TORONTO, Jan 18 (Reuters) - The Canadian dollar weakened against its U.S. counterpart on Monday, extending a pullback from a near three-year high, as rising coronavirus cases globally weighed on investor sentiment and ahead of a Bank of Canada interest rate decision this week. Global stock markets and the price of oil , one of Canada"s major exports, dipped as fears over soaring COVID-19 cases around the world and the slow pace of vaccination against the virus outweighed a better-than-expected quarterly rebound for China"s economy. U.S. crude oil futures were down 0.1% at $52.31 a barrel, while the Canadian dollar declined 0.3% to 1.2764 per greenback, or 78.35 U.S. cents, having traded in a range of 1.2726 to 1.2799. On Thursday, the loonie touched its strongest in nearly three years at 1.2621. Speculators have cut their bullish bets on the Canadian dollar for the second straight week, data from the U.S. Commodity Futures Trading Commission showed on Friday. Canadian housing starts fell 12.2% in December compared with the previous month to 228,279 units, data from the national housing agency showed. The number of units was close to the 227,000 level economists had forecast. Canada"s inflation report for December and a Bank of Canada interest rate decision are due on Wednesday. Analysts see a chance of a "micro rate cut," with the central bank moving its benchmark rate by less than 25 basis points, avoiding negative rates. The policy rate was cut in March to a record low of 0.25%. The recent strength in the Canadian dollar and the economic impact of the latest restrictions to contain the coronavirus pandemic could prompt easing, "though the case is not particularly compelling," Benjamin Reitzes, Canadian rates & macro strategist at BMO Capital Markets, said in a note. Canada"s 10-year bond yield was up 1.8 basis points at 0.823%. (Reporting by Fergal Smith; Editing by Kirsten Donovan)