Soros says Bank of England "behind the curve"

LONDON (Reuters) - The Bank of England did the right thing by cutting interest rates on Thursday but it is "behind the curve" in acting to counter the credit crunch, billionaire investor George Soros said.

The Bank cut its main rate by a quarter point to 5.0 percent, the third cut in five months.

"I think they are doing the right thing cutting it but they are actually behind the curve," Soros told Britain's Channel 4 news.

Asked what else the Bank could do, he said, "They do have to lower interest rates."

Soros said the global financial crisis was the worst of his lifetime. "We now are in a period of wealth destruction and it will have an effect on the real economy," he said.

He said British house prices would fall because they had risen far too much to unsustainable levels.

The crisis would also affect Britain because London was a centre of the global financial system that was now contracting, said Soros, who made $1 billion by betting against the British pound in 1992.

"I have very great respect for Mervyn King, but he's one of the great theoretical exponents of that idea that markets tend towards equilibrium," he said, referring to the Bank of England governor.

"I think there is a need to recognise that asset bubbles have to be controlled by the authorities. It's not enough to control money, you also have to control credit," he said.

(Reporting by Adrian Croft; Editing by Leslie Adler)