Funds see steady growth in 2008

Bangkok Post (14 November 2007)

Fund managers say the market is expected to post steady growth in 2008, thanks to expectations of easing domestic political worries after the Dec 23 election.

Sukkawat Prasertying, chief investment officer at Manulife Asset Management, said growth in the mutual-fund industry next year would be strongest in foreign investment funds, short-term debt funds and local equity funds.

He said competition was expected to increase next year, with foreign players launching more innovative products and local, bank-owned asset-management companies leveraging their customer base and distribution network for growth.

Manulife Asset Management plans to launch a new foreign investment fund and a fixed-income fund next year.

''We have no policy to launch too many kinds of funds, but will instead focus on quality and return on investment,'' Mr Sukkawat said.

Panukorn Chantaraprapab, director for equities at Manulife Asset Management, said the Thai market remained attractive in the region thanks to relatively low valuations.

Oil prices were expected to remain high, raising costs for local companies, he added.

For the property sector, detached home sales were expected to slow in 2008, although demand for townhouses was likely to increase.

Meanwhile, Michael Feroli, an economist with US investment bank JPMorgan, said the US economy was ''bending, not breaking'', and that the weak dollar would help boost US exports.

Dr Feroli said the US economy was likely to show 3.5% growth in the third quarter of 2008 from 1% this quarter if the Federal Reserve keeps interest rates unchanged at 4.5%.

He said the overall outlook remained relatively bright, even though the US economy was expected to head into recession.