Washington, Dec 20: The market turmoil which has bogged down many Southeast Asian economies could have been avoided, the International Monetary Fund has said, claiming it had warned about the risk though the currency crisis was ``inherently non-forecasteable.''

``Recent issues of the IMF's world economic outlook (HAD) repeatedly warned about the risks of disruptive changes in investor sentiment unless policies were adjusted to address overheating and to reduce unsustainable external imbalances,'' the latest interim report of the IMF said.

"While conceding that neither economic forecasts nor the pricing of assets in financial markets foretold the depth of the crisis which engulfed several Southeast and East Asian economies, the international funding agency said enough indications available to take some corrective steps to avoid or lessen the crisis."

It may well be that such developments are inherently non-forecastable, as their occurrence and...timing are linked to sudden changes in investor sentiment and market conditions. But the risks of financial market turbulence not only could have been perceived: they were perceived,'' it said.

The report also rejected criticism that foreign investors have made a killing out of the miseries of the east Asians and said they have, rather, suffered big losses.

About the crisis, the global financial institution claimed that warnings were communicated ``through other channels of IMF surveillance'' but were not heeded to.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.