* Loonie trades in a range of 1.2170 to 1.2189 * Canada"s annual inflation rate accelerates to 3.6% in May * Price of U.S. oil touches its highest level since October TORONTO, June 16 (Reuters) - The Canadian dollar was little changed against its U.S. counterpart on Wednesday as domestic data showed consumer prices rising at the fastest pace in a decade, with the currency steadying after falling on Tuesday to a near seven-week low. Canada"s annual inflation rate accelerated to 3.6% in May from 3.4% in April, driven by surging shelter and passenger vehicles prices, Statistics Canada said. That was slightly ahead of analyst expectations and the highest since May 2011. The Bank of Canada has said it expects inflation to ease later in the year as the statistical comparison to tanking prices last year diminishes and slack in the economy exerts downward pressure. With U.S. inflation also on the rise, investors were looking to the Federal Reserve policy statement at 1400 EDT (1800 GMT) for signs of a response. Currency market activity was generally quiet ahead of the announcement. The Canadian dollar was trading nearly unchanged at 1.2184 to the greenback, or 82.07 U.S. cents, after trading in a range of 1.2170 to 1.2189. On Tuesday, the currency touched its weakest intraday level since May 6 at 1.2204. It has pulled back from a six-year high earlier this month at 1.2007. Oil , one of Canada"s major exports, notched its highest level since October 2018 at $72.83 a barrel before pulling back to $72.10, supported by a recovery in demand from the coronavirus pandemic and a drop in U.S. crude inventories. Canadian government bond yields were little changed across the curve, with the 10-year flat at 1.383%. On Monday, it touched a 3-month low at 1.365%. (Reporting by Fergal Smith; Editing by Andrea Ricci) Our Standards: The Thomson Reuters Trust Principles.