Recently installed phpbb and during install requested to setup mysql database l/p.
As i figured out this is same as my regular l/p for my hosting account.

config.php (644) is located in
/home/infose1/public_html/forum/
this file contains in plain text my account login informations.

Is it safe this use this way?

You could rename it to something that no one can guess, (obviously change the rest of the code to match!)

Try downloading it and see if you can see your password init. I doubt the makers of Phpbb are stupid enough to let such a big security problem be there!

I know on a good many boards, after the installation, they advise you to delete the config file. I would check into that, and see if you should delete that file.