U.K. CENTRAL BANK WARNS OF EXCESSIVE RATE CUTS
  Bank of England governor Robin
  Leigh-Pemberton said lowering interest rates too fast could
  jeopardise recent economic achievements in the U.K.
      In remarks prepared for delivery to businessmen in
  Birmingham, he said prospective returns on real investment are
  more favourable, relative to those on financial assets, than
  for a good number of years.
      "It would surely be foolish to put that favourable
  conjuncture at risk by lowering interest rates prematurely or
  excessively," he said.
      "We might enjoy a short-term boost to activity, but at the
  risk of a damaging return to the uncertainty and acrimony of
  high inflation," he added.
      Leigh-Pemberton said he recognised there are some who would
  argue that interest rates are still too high and deter
  investment in industry.
      "But we should not forget that less than a year ago we were
  intervening to support sterling and had some temporary
  difficulty in persuading the markets that a one pct increase in
  base rates, to 11 pct, was a sufficient tightening of policy at
  the time," he added. Base rate is currently nine pct.
  

