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Euro zone bonds steady, inflation data eases pressure off ECB

* Euro zone inflation comes in above consensus

* Spanish bonds underpinned by lift in ratings outlook

* S&P strips Netherlands of its triple-A rating

By Ana Nicolaci da Costa

LONDON, Nov 29 (Reuters) - Euro zone bonds held within recent ranges on Friday after higher than expected euro zone inflation data eased pressure for the European Central Bank to act, although more monetary easing continues to be expected.

The market also showed limited reaction to Standard & Poor's move to strip the Netherlands of its triple-A rating. S&P also lifted Spain's rating to stable, underpinning Spanish bonds.

Data showed the first fall in euro zone unemployment in almost three years and rising consumer prices, supporting the view that the economy is recovering, although inflation remains well below the ECB's target of just under 2 percent.

"It's not a game changer. The only thing that it may do is slow down the process, the decision-making," Rabobank's senior market economist Elwin de Groot said. "With this figure, it buys the (ECB) a bit more time to discuss things."

German Bund futures were up 3 ticks at 141.68, with 10-year German yields little changed at 1.69 percent. Dutch bond 10-year yields were also steady at 2.02 percent, while yields on other higher-rated bonds were up slightly.

Trade has been quiet this week due to Thursday's U.S. Thanksgiving holiday.

An unexpected fall in inflation in October prompted the ECB to deliver a surprise rate cut earlier this month.

Recent comments from officials have suggested further monetary easing is on the cards but opposition from the bank's German representatives has shown that any such move could face resistance within the Governing Council.

Euro zone consumer prices rose 0.9 percent in November, above the 0.8 percent forecast and up from 0.7 percent in October, but still below the ECB's target.

Key for the rates outlook will the staff projections to be published at next week's ECB monetary policy meeting.

"The ECB will have to be dovish next time because the staff forecast will be so low, especially in terms of the outlook for inflation," one trader said.

RATINGS

S&P was the second credit ratings agency in less than a month to lift its outlook for Spain, rewarding it for moves to rein in public finances and put the economy on a more competitive footing.

Ten-year Spanish government bonds rose, with yields falling 1.4 basis points to 4.14 percent.

"It's the second rating agency to upgrade its outlook on Spanish debt after Fitch several weeks ago, so it just confirms the fact that this downward cycle on sovereign ratings is now behind us," Natixis fixed income strategist Cyril Regnat said.

The agency also took away the Netherlands' triple-A rating, leaving only three euro zone government with a full set of top-grade ratings. With even the United States having lost its triple-A status, however, such downgrades have had only limited impact on country's borrowing costs in recent years.

(Editing by Catherine Evans)