By Chris Fournier Oct. 17 (Bloomberg) -- Canada's currency is poised for its third weekly decline, the longest losing streak since August, as the threat of a U.S. economic slowdown reduced commodity prices. The Canadian currency weakened 0.8 percent this week, as crude oil sank below $70 a barrel and the country's main stock index touched the lowest in four years. The U.S. is Canada's largest trading partner. Oil accounted for 10 percent of Canada's export revenue in 2007. ``We've seen pretty steady selling of the Canadian dollar,'' said Samarjit Shankar, director of global strategy for the foreign-exchange group in Boston at Bank of New York Mellon, the world's largest custodial bank. ``The flow of economic data is pretty negative in the U.S. We have the usual correlation in energy prices and the Canadian dollar. The U.S. slowdown is expected to have an impact on Canada's exports.'' The Canadian dollar depreciated as much as 1.3 percent today to C$1.1932 per U.S. dollar, from C$1.1783 yesterday. It last traded at C$1.1844 at 11:40 a.m. in Toronto. The currency reached C$1.1732 on Oct. 10. One Canadian dollar buys 84.46 U.S. cents. Crude oil for November delivery lost more than $5 this week and yesterday touched $68.57. It has lost more than half its value since reaching a record $147.27 on July 11. The Canadian dollar has depreciated 14 percent since then. Crude accounts for 21 percent of the weighting in the Bank of Canada Commodity Price Index, the largest single component. The Index fell 6.6 percent this week to the lowest in more than a year. `Very Difficult' ``We're advising holding on to the U.S. dollar,'' Shankar said. ``We're expecting the greenback to build on its gains. Currencies like the Canadian dollar are going to find it very difficult to get support.'' The Standard & Poor's/TSX Composite Index yesterday reached the lowest since October 2004. The Dow Jones Industrial Average fell 0.9 percent today. ``Everything we got this week suggests the U.S. downturn will be accelerating in the second half of this year,'' said Stefane Marion, assistant chief economist at National Bank Financial in Montreal. ``That will undermine demand for commodities in 2009. What dominates the Canadian dollar is what happens to commodity prices.'' Data released today showed housing starts and building permits declined in the U.S. during September. To contact the reporter on this story: Chris Fournier in Montreal at cfournier3@bloomberg.net

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