* Dollar rises against basket of currencies
* Copper on track to rise 1.5 percent this week
* Coming up: U.S. PPI for November at 1330 GMT
LONDON, Dec 13 (Reuters) - Copper slipped on Friday after five sessions of gain as the dollar rose across the board and caution prevailed ahead of a U.S. Federal Reserve meeting next week.
Three-month copper on the London Metal Exchange was at $7,220 a tonne at 1050 GMT, down from a last bid of $7,226 on Thursday.
After hitting one-month highs this week, the metal used in power and construction is trading 1.5 percent higher for the week but is down more than 8 percent this year.
Weighing on metals prices was a rise in the dollar against a basket of currencies, following upbeat U.S. retail sales data and the smooth passage through the U.S. House of Representatives of a budget deal to avoid a government shutdown.
A strong dollar makes commodities priced in the U.S. unit more expensive for holders of other currencies.
The focus next week is likely to be on a Federal Reserve policy meeting on Dec. 17-18 for any indications of when the central bank might begin reining in its massive stimulus programme.
The Fed is expected to reinforce its commitment to keeping interest rates near zero even as it prepares markets for the long road back to policy normalcy.
The stimulus programme has released more money into the economy, and has been used to buy assets including commodities.
"It is all about the taper and its timing, of course," said Anita Paluch, strategist at Varengold Bank.
"The only high profile data out there today is U.S PPI data(which is) expected to pick up. And since it is highly correlated with the CPI numbers.. due out next week on Tuesday, it may fuel speculation of quantitative easing being wound down."
U.S. producer price index (PPI) for November, which indicate inflation pressures, is due later in the session.
Helping keep falls in check was tightening supplies. Reflecting tight near-term supply, LME cash copper surged on Thursday to a $14.50 premium against the three-month contract CMCU0-3, the highest since July 2012, before easing slightly to trade at $13.50 on Friday.
Copper users in top consumer China are braced to pay higher premiums to procure metal and global exchange stocks have slumped to five-year lows, flagging tight supply that some traders expect to stretch out into next year.
"We're definitely looking at this quarter and the first quarter of next year to be tighter than what the annual surplus would suggest," said Sijin Cheng, analyst at Barclays in Singapore.
"All of the price indicators are pointing to a tight balance and also our contacts are saying it's still tough to get copper. It speaks to the delay in turning concentrate into refined surplus. Also you have had scrap being taken out of the market ... and it probably won't improve too much next year."
In industry news, Chile's Codelco, the world's largest copper miner, said on Thursday it would implement measures to safeguard production at its Chuquicamata mine where a strike forced the company to halt smelting operations.
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