UPDATE 2-Mexico Dec retail sales decline sharply

* Mexico retail sales shrink most since May 2009

* Monthly sales decline 2.6 pct; poll saw -0.90 pct

* Year-ago sales up 3.5 pct; poll saw 3.20 pct rise (Adds graphic, comment, background)

MEXICO CITY, Feb 22 (Reuters) - Mexican retail sales fell 2.60 percent in December, the biggest decline since May 2009, after shoppers moved up holiday purchases to fuel a record shopping spree in November.

The sales decline was greater than the 0.9 percent dip forecast by a poll and followed a rise in November of 2.2 percent.

In November a government-sponsored long weekend of discounts and promotions had lifted retail sales, analysts had expected those gains would undermine December demand.

Retail sales increased 3.50 percent compared with December 2010, slowing from November's 7.5 percent rise. Analysts expected a 3.20 percent annual increase.

Economists at Goldman Sachs said moderate employment and credit growth and contained real wage gains were likely to keep consumer spending at moderate levels in the near term.

They cautioned, however, against reading too much into the disappointing figures.

"In the past the retail sales indicator has not been a reliable guide for the strength of private consumption; i.e., retail sales provided a much weaker signal than the actual performance of private consumption," they wrote in a research note.

Mexico's economy grew at its weakest pace in 2-1/2 years in the fourth quarter of 2011 as the services sector suddenly slackened and a global slowdown dragged on exports.

The central bank last week said it saw the economy growing between 3 percent and 4 percent this year after expanding 3.9 percent in 2011, but added that Europe's debt troubles could drag down global growth more than expected. (Reporting By Michael O'Boyle; Editing by Leslie Adler)