BOT board chair warns of bubble in Thai financial and property sectors

BANGKOK, March 18 (TNA) - Chairman of the Bank of Thailand (BOT) board Virabongsa Ramangura has warned of a bubble threat in the country's financial and property sectors, from late this year to early next year. During his speech on Thailand's sustainable development and movements in the ASEAN Economic Community (AEC) at the Four Seasons Hotel in Bangkok on Monday, Virabongsa said there are now clear signs of the bubble threat in the Thai financial and property sectors, which he is concerned. Virabongsa explained the surge of the Stock Exchange of Thailand or SET index, from slightly over 1,000 points to about 1,600 points now, reflects that there have been rising capital inflows and business operators have been interested in Thai government bonds and have bought over 15 per cent of them. Virabongsa, who is also the chair of the government's committee on strategies for rehabilitating and creating the future of Thailand, cautioned that the SET index and the bond purchase of business operators can rise further, and that an obvious sign is the ongoing appreciation of the baht. The BOT board chair assessed that the Thai central bank will unlikely cut its key interest rate to slow down capital inflows, urging concerned parties to, thus, beware of the bubble threat in the Thai financial and property sectors and to prevent any bubble burst. The incumbent BOT board chair, who is a former Thai deputy prime minister and a former finance minister, noted that Thailand appears to be in a great danger, as its financial market is open and there has not yet any instrument to protect it. The former Thai deputy premier, meanwhile, foresaw that the AEC should be a turning point in trade and investment for member countries of the Association of Southeast Asian Nations (ASEAN) and other economies in the region, and that China and other Asian economies should now play important roles in world economic development, as it should take a long time for the US and the European economies to recover. The former deputy premier, a wellknown Thai economist, also predicted that several countries should be expanding their investment projects into Thailand, thanks to positive factors, including the Thai government's new 2.2-trillion-baht infrastructure development projects, pointing out that Japan and China consider Thailand as their best destination for investment. The BOT board chair suggested that the government further develop Thailand's deep-sea ports in Map Ta Phut and Laem Chabang in the East to support national economic growth in the future. (TNA)