December 14, 2017 / 11:18 AM / 10 months ago

PRECIOUS-Gold dips, off one-week high after strong U.S. data

    * Dollar bounces back from one-week low
    * U.S. retail sales data stronger than expected
    * Platinum shrugs off Lonmin takeover

 (New throughout, updates prices, market activity and comments,
adds second byline and NEW YORK dateline)
    By Renita D. Young and Eric Onstad
    NEW YORK/LONDON, Dec 14 (Reuters) - Gold dipped slightly on
Thursday, easing off a one-week high as the dollar rebounded
following strong U.S. retail sales data, while palladium rose to
its highest since February 2001.
    U.S. retail sales increased more than expected in November
as the holiday shopping season got off to a brisk start.
    "We have not seen this strong pace of strength for the U.S.
retail sales data since 2012," said Naeem Aslam, chief market
analyst at Think Markets UK.
    Spot gold        dipped 0.03 percent to $1,255.77 per ounce
by 2:43 p.m. EST (1943 GMT). In early trading it touched a
one-week high of $1,259.11.
    U.S. gold futures         for February delivery settled up
$8.50, or 0.7 percent, at $1,257.10 per ounce. 
    Palladium        was up 1.4 percent at $1,030.80 an ounce.
Earlier, it hit a 16-1/2-year high, jumping 2 percent to $1,038
an ounce.
    Strong U.S. retail sales data boosted the dollar, making
dollar-denominated bullion more expensive for holders of other
    "Many went into yesterday's Fed meeting with an expectation
for more (interest) rate hikes as opposed to less," said David
Meger, director of metals trading at High Ridge Futures in
Chicago. "This was a technical retracement off yesterday's
    The spot gold price rallied to $1,256.87 on Wednesday after
the Fed raised its benchmark interest rates and projected three
more hikes in each of 2018 and 2019, which was expected.
    Gold is sensitive to rising rates because they push up bond
yields, reducing the appeal of non-yielding bullion. Rising
interest rates also tend to boost the dollar, making gold more
expensive for holders of other currencies. 
    The U.S. economic data was released after both the European
Central Bank and the Bank of England kept rates unchanged. 
    "Today, spot gold is still significantly higher than where
we were going into the Fed meeting yesterday," Meger said.
    Prior to the Fed decision, spot gold had fallen to $1,239.98
an ounce. 
    While U.S. tax reform uncertainty may support gold, there
were also risks bullion could revisit its range bottom close to
$1,200, said Jonathan Butler, commodities analyst at Mitsubishi
in London, due to a continued increase in U.S. stocks and
unconventional assets including crypto currencies.
    Platinum        dipped 0.7 percent at $878.80 an ounce,
earlier reaching a 6-day high of $891.20. 
    Silver        fell 0.8 percent to $15.93 an ounce, after
hitting a five-month low of $15.59 in the previous session.

 (Additional reporting by Apeksha Nair in Bengaluru and Zandi
Shabalala in London; editing by Edmund Blair and David Gregorio)
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