Spanish consumer prices fell in December at their fastest rate since July 2009, largely as a result of cheaper oil, with lower prices helping to draw Spaniards back into stores and push up retail sales.
Preliminary data from statistics agency INE showed consumer prices were 1.1% lower this month than in December 2013.
Prices fell for the sixth consecutive month and they fell faster than expected as fuel prices declined.
European-Union harmonised prices also fell 1.1% compared to a 0.5% drop in November.
Economists polled by Reuters had forecast a 0.7% decline.
The Spanish reading was the first for December in the euro zone and will reinforce demands for the European Central Bank to start buying government bonds with new money to avert deflation and support growth across the 18-country bloc.
Euro zone preliminary price data for December will be published on January 7. Inflation was just 0.3% in November, far from the ECB's target of just below 2%.
Many economists expect Spanish consumer prices to stay negative or very close to zero throughout 2015, as this year's plunge in the price of oil to a five and a half year low is felt in a country heavily dependent on energy imports.
Retail sales data for November, also released today, showed that after a nearly six-year economic slump, Spaniards were taking advantage of bargain prices.
INE said retail sales rose 1.9% year on year after increasing 1 percent in October, the strongest rise in a year.
