* Spain flash national consumer prices up 2.9 pct in Nov
* Reading will be key to government pension hike decision
* May imply additional state cost of 3.8 billion euros
MADRID, Nov 30 Spanish inflation eased in
November thanks to a dip in energy prices but it remained far
above the euro zone average, likely raising the cost of state
pension rises for an already hard-pressed budget.
Prime Minister Mariano Rajoy has pledged to raise pensions
by at least one percent for 2013 and has said he will decide
whether to hike payments in line with consumer prices once final
November inflation is published in mid-December.
Spain's current legislation states that retirement payments
must increase at the same rate as inflation, but the measure has
come under scrutiny as the country battles to reduce its budget
deficit and quell concerns over its public finances longer-term.
The EU-harmonised consumer price data showed inflation of
3.0 percent year-on-year in November, lower than a consensus
forecast and down from 3.5 percent in October.
National Statistics Institute data, key for the pension
rise, showed Spain's national consumer price index, rose by 2.9
percent in November on an annual basis, down from 3.5 percent in
Given that the government has already budgeted an inflation
of 1 percent, a final reading of 2.9 percent would imply an
additional cost of 3.8 billion euros for state coffers.
The final November reading is due on Dec. 13.
Continuing sharp rises in prices in Spain, due largely to
the impact of taxation and higher fuel prices, also hammer
consumers already dealing with unemployment of 25 percent in an
economy that is deep in recession.