Fitch removes Thailand's rating from watch negative

HONG KONG, Oct 23 (Reuters) - Fitch Ratings said on Monday it had removed Thailand's local and foreign currency ratings from watch negative after the country's swift resumption of political stability following last month's military coup.

The rating agency affirmed Thailand's BBB-plus long-term foreign currency and A long-term local currency ratings. The outlook on the ratings is now stable, it said in a statement.

After Fitch's move, Standard & Poor's is the only credit rating agency that has Thailand's credit ratings on review for a possible downgrade.

"We expect (S&P) to act sometime soon," said Lloyd Ong, senior credit analyst at BNP Paribas. "The overall environment does call for a stable outlook."

Five-year Thailand's credit default swaps -- insurance-like contracts that offer protection against debt default or restructuring -- were unchanged at 37/38 basis points after the Fitch announcement.

"The rating affirmations come on the back of the swift resumption of political stability following the military coup on September 19, 2006, as well as continued strength in Thailand's key credit indicators (and their superiority relative to the "BBB" median)," Fitch said.

Fitch and S&P had put Thailand's ratings on review for possible downgrade following the bloodless coup to oust Prime Minister Thaksin Shinawatra.

Moody's Investors Service has maintained a Baa1 rating and stable outlook.

Since the coup, the military leaders have appointed an interim prime minister and promised elections under a new constitution within a year.

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