(Adds strategist quote and details throughout; updates prices) * Canadian dollar weakens 0.1% against greenback * Price of U.S. oil increases 1.6% * Bank of Canada"s BOS indicator reaches a record high * Canadian bond yields rise across a steeper curve By Fergal Smith TORONTO, July 5 (Reuters) - The Canadian dollar edged lower against its U.S. counterpart on Monday, but clawed back much of its earlier decline as oil prices increased and a survey by the Bank of Canada showed that business sentiment in Canada continues to improve. The loonie was trading 0.1% lower at 1.2330 to the greenback, or 81.10 U.S. cents, recovering from an intraday low of 1.2371. "The move looks to be connected to the market"s response to the OPEC meeting and the crude price rally," said Eric Theoret, global macro strategist at Manulife Investment Management. The price of oil , one of Canada"s major exports, rose 1.6% after OPEC+ nations called off talks on output levels, meaning no deal to boost production has been agreed. On Friday, the Canadian dollar notched its biggest gain in eight weeks, advancing nearly 1%, after the U.S. nonfarm payrolls report suggested space for the Federal Reserve to wait before tightening monetary policy. U.S. financial markets were closed on Monday, observing the Independence Day holiday. Speculators have raised their bullish bets on the Canadian dollar to the highest level in four weeks, data from the U.S. Commodity Futures Trading Commission showed on Friday. As of June 29, net long positions had increased to 45,801 contracts from 43,225 in the prior week. The Bank of Canada"s Business Outlook Survey (BOS) Indicator reached its highest level on record in the second quarter, in part due to base-year effects, but also as positive sentiment became more widespread. The central bank is due to make a policy announcement next week, with some analysts expecting another cut to the pace of bond purchases. Canadian government bond yields were higher across a steeper curve. The 10-year rose 2.9 basis points to 1.403%, after earlier touching its lowest level since March 3 at 1.358%. (Reporting by Fergal Smith Editing by Mark Heinrich, William Maclean) Our Standards: The Thomson Reuters Trust Principles.