Consumer prices were flat in November as Americans paid less for cars and gasoline, a further sign of a cooldown in inflation that could give the Federal Reserve more room to help a still-weak economy.

The Labor Department said on Friday the Consumer Price Index was unchanged last month. Economists had expected an increase of 0.1 percent.

Prices rose 3.4 percent in the 12 months through November. That is off from the 3-year high of 3.9 percent clocked in September, and Friday's report backs the view that the spike in inflation is subsiding.

This is an inflation report that leaves the Fed ample cover for any additional monetary policy accommodation they may see warranted in the New Year, said Ian Lyngen, a bond strategist at CRT Capital Group in Stamford, Connecticut.

However, some of the data in the report could give pause to policymakers still concerned about inflation. Outside food and energy, prices climbed 0.2 percent.

These so-called core prices rose 2.2 percent in the 12 months through November, up from 2.1 percent in October.

But dragging down the overall index, gasoline fell 2.4 percent and prices for new vehicles were down 0.3 percent.

Economists and investors see inflation slowing over the coming months, which could help convince the Federal Reserve to do more to bring down the country's 8.6 percent unemployment rate.

The dollar pared losses against the euro following the inflation report, while prices for U.S. government debt erased losses. U.S. stock index futures held steady at higher levels.

Earlier in the week, the Fed warned that turmoil in Europe presents a big risk to the U.S. economy, and policymakers left the door open to further steps to boost growth.

Despite aggressive moves by the Fed to boost the economy, some Fed officials view the central bank's aggressive efforts as bordering dangerously on an invitation to inflation.

Prices for food rose 0.1 percent during November. Within the core index, prices for apparel jumped 0.6 percent.

Most economists have said the Fed's next meeting on January 24-25 would be the more likely occasion for any new moves to bring down borrowing costs and help growth.

The U.S. central bank has held overnight interest rates near zero since December 2008 and has bought $2.3 trillion in government and mortgage-related bonds in a further attempt to stimulate a robust recovery.

(Reporting by Jason Lange; Editing by Neil Stempleman)