SPANISH EMPLOYERS WORRIED BY HIGH INTEREST RATES The head of Spain's employers' federation, Jose Maria Cuevas, said employers were worried about the government's monetary policies because high real interest rates were hampering investment. He told a news conference wage pacts signed so far this year were not endangering the government's five pct inflation target. The government's perceived need to control inflation by keeping a tight rein on credit was unnecessary, he said. High real interest rates were attracting an influx of speculative foreign capital which was undercutting the government's target for monetary growth, Cuevas said. Spain's most closely-watched measure of money supply, liquid assets in public hands, grew at an annualised rate of 17 pct in March, against 11.4 pct in December last year and a target range of 6.5 to 9.5 pct for 1987. To combat this, the Bank of Spain has raised its call money rate 14 times so far this year, to 14.5 pct at present from 11.8 at end-1986. Cuevas said employers were heeding the government's call to hold wage increases to its five pct inflation target this year, with increases from salary reviews awarded last year and new wage pacts averaging 5.6 pct in the first quarter of 1987. These agreements covered less than 40 pct of Spanish workers, Cuevas said, with the rest still in wage negotiations. He said Spain's current wave of strikes mainly affected the state sector, where the government is trying to impose its five pct wage ceiling. Cuevas said employers were also worried about the trend in Spain's foreign trade balance. The trade deficit in the first two months of 1987 totalled 233 billion pesetas, a 68 pct increase over the corresponding period last year. However, employers did not favour a devaluation of the peseta to correct the imbalance.