FED’ rescuing 2 housing-loan providers not to hurt Thai economyJuly 15th, 2008 - 9:23 am ICT by Amrit Rashmisrisethi
The Bank of Thailand (BOT) Governor, Mrs. Tarisa Watanagase (ธาริษา วัฒนเกษ), believes that the FED’s financial support to the two biggest housing-loan providers and guarantors, Fannie Mae and Freddie Mac, will not hit excess liquidity and not result in a tight money situation in Thailand.
Mrs. Tarisa believes that foreign investors will abandon regional bourse for fear of the consequences of economic volatility. The concern that Washington-based Fannie Mae and McLean, Virginia-based Freddie Mac may collapse escalated last week.
The central bank chief adds that Thai financial institutions circulate cash by around 500 billion baht in their businesses. She points out that with their 80 percent credit rate, the tight money situation will hardly emerge. Mrs. Tarisa admits the SET Index may however experience temporary slump due to the FED’s decision to buy huge stakes in both struggling housing-loan providers.
Source : National News Bureau, Public Relations Department of Thailand