(Recasts with inflation cooling, adds background)
MEXICO CITY, Dec 9 (Reuters) - Mexico's annual inflation rate cooled in November, but it was still above the 4 percent ceiling of the central bank's target, and a deep slump in the peso threatens to fan consumer prices higher.
Inflation in the 12 months through November eased to 4.17 percent, the national statistics agency said on Tuesday, down from a 4.30 percent annual rate in October and just below a Reuters poll's expectations of 4.18 percent.
Mexico's annual inflation rate rose in the previous six months, driven by higher prices for some fresh foods.
The central bank last week held its benchmark interest rate at 3 percent and said inflation should fall to near 3 percent by mid-2015. But policymakers said prolonged peso weakness could affect consumer prices.
Consumer prices rose 0.81 percent in November from October, compared with an expected 0.82 percent as the government cut summer electricity subsidies.
Core inflation, which strips out some volatile food and energy costs, rose 0.16 percent, in line with the poll.
Mexico's peso has tumbled about 11 percent since June, hitting a 2-1/2-year low to the U.S. dollar last week. As a result, the central bank restarted a dollar auction program on Tuesday to help cushion the peso's slide.
In an interview published on Monday in daily newspaper El Universal, central bank Governor Agustin Carstens suggested the bank may have to raise interest rates if the currency's losses affect consumer prices.
Reporting by Michael O'Boyle