The outlook on Thailand’s long-term local currency credit rating was cut to negative from stable by Fitch Ratings, citing the country’s worsening political unrest.
The rating for the local-currency debt was affirmed at A-. The country’s long-term foreign currency credit rating was kept at BBB with a stable outlook, Fitch said in a statement today.
The change in outlook “reflects an escalation in political uncertainty, coupled with a slow economic recovery and a deteriorating policy environment, all of which are expected to impact adversely on sovereign creditworthiness over time,” Vincent Ho, associate director in Fitch’s Asia sovereign ratings team, said in the statement.
Clashes this month between Thai anti-government protesters and security forces in Bangkok killed 25 people and injured over 800 others in the deadliest political violence in 18 years. Tourism may be “decimated” by the unrest, and economic growth may be shaved by one or two percentage points, Finance Minister Korn Chatikavanij said April 15.