(Adds strategist quotes and details throughout; updates prices) * Canadian dollar touches its weakest since July 21 at 1.2653 * Canada"s annual inflation rate accelerates to 3.7% in July * Price of U.S. oil settles 1.7% lower * Canadian bond yields rise across the curve By Fergal Smith TORONTO, Aug 18 (Reuters) - The Canadian dollar was little changed against the greenback on Wednesday as investors weighed minutes from the latest Federal Reserve meeting, while domestic data showing higher inflation was seen unlikely to move the needle for the Bank of Canada. The loonie was trading nearly unchanged at 1.2634 to the greenback, or 79.15 U.S. cents. It touched its strongest level of the session at 1.2597 after the inflation data but then fell to its weakest since July 21 at 1.2653. "It"s predominately the big dollar that is driving the loonie right now," said Bipan Rai, North America head of FX strategy at CIBC Capital Markets. The U.S. dollar seesawed against a basket of major currencies as the minutes showed Fed officials felt the employment benchmark for decreasing support for the economy "could be reached this year," but had not yet been satisfied. Canada"s annual inflation rate accelerated to 3.7% in July, up from 3.1% in June and the hottest pace since 2011, due to both the base-year effect and higher shelter costs. The Bank of Canada has said that the factors pushing up inflation are transitory. "I think the market is entrenched in its view that the Bank of Canada is going to hike in the middle part of next year but they"re going to be patient," Rai said. "I don"t think the inflation data this morning changed much." The price of oil , one of Canada"s major exports, settled 1.7% lower at $65.46 a barrel, with investors remaining worried about the outlook for fuel demand as COVID-19 cases surge worldwide. Canadian government bond yields were higher across the curve. The 10-year rose half a basis point to 1.160%, after touching on Tuesday its lowest intraday level in nearly two weeks at 1.120%. (Reporting by Fergal Smith; Editing by Barbara Lewis and Andrea Ricci) Our Standards: The Thomson Reuters Trust Principles.