* 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. 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 XAU= 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 GCcv1 for February delivery settled up $8.50, or 0.7 percent, at $1,257.10 per ounce.
Palladium XPD= 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 currencies. FRX/
"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 highs."
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. 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. 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 XPT= dipped 0.7 percent at $878.80 an ounce, earlier reaching a 6-day high of $891.20.
Silver XAG= fell 0.8 percent to $15.93 an ounce, after hitting a five-month low of $15.59 in the previous session.