Rhymes with pew, few, you, new, yew, Kew, etc.
If I see "loo" absent context I would normally pronounce it without that intervening sound. Whereas "lieu" has it.
Now I'm confused over whether Kivaloo is '~oo' as I assumed, or (roughly, weaker 'y') '~yoo' as I think we agree 'lieu' is?
I was wondering if that is a common Canadian pronounciation.
Wiktionary suggests Canada generally follows the pronunciation your familiar with.
The last one is in jest. The word is pronounced the same--in the US, often the US is called America, seemingly excluding Canada, Central America, South America.
And a fact that I didn't know until recently was that the Philippines prior to WW II was part of the United States. See "How to hide an empire" by Daniel Immerwahr: https://www.amazon.com/How-Hide-Empire-History-Greater/dp/03...
I do commonly hear the expression "in lieu of" rendered "in loo of" but have always considered that incorrect, much like pronouncing the t in "often".
It is, of course, just dialect, and the entire idea of 'incorrect pronunciation' is suspect! But I can't help but consider /lyu/ to indicate a higher, er, register.
From my experience, the more north you go the more you talk with your tongue/mouth. In my examples I was almost able to complete full sentences without moving my lips at all.