Fitch: Bahrain on watch

Fitch Ratings said it placed on Rating Watch negative Bahrain's long-term foreign-currency issuer default rating of A, local-currency issuer default rating of A+ and short-term foreign-currency issuer default rating of F1.

The agency also said it affirmed its country ceiling at A+.

The negative watch reflects the intensification of unrest and growing divide between protestors' demands and the government's position on political reform, Fitch said.

The unrest has created economic and political uncertainties, which increase the risks to the sovereign's credit profile, the agency said.

The protests have already had fiscal consequences due to an estimated 2% of GDP in handouts recently announced, the agency said.

A substantial worsening in the security situation or the incurrence of larger fiscal costs would prompt a downgrade, Fitch said.

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