Sept. 19 (Bloomberg) -- Thailand's Prime Minister Thaksin Shinawatra declared a state of emergency before demonstrations intended to oust him were due to take place and fired the country's army chief.

Thaksin spoke on state television in a broadcast from New York, where he was attending a meeting of the United Nations General Assembly.

Ten tanks blocked traffic outside Government House in the capital, Bangkok, the British Broadcasting Corp. said, citing Reuters. Thai forces seized government house after the army chief was fired, Agence France-Presse reported. The Thai army and police now control Bangkok, Sky News cited Thai television as saying.

Bangkok police had been bracing for prolonged political protests as Thais seeking to oust Thaksin planned to resume mass rallies tomorrow, after more than six months on the sidelines.

The army chief, Sondhi Boonyarataklin, had earlier dismissed rumors of a possible coup and a defense spokesman said Thai military leaders had pledged not to interfere in politics, the Bangkok Post reported on Sept. 14.

The Thai baht fell the most in a month. Against the dollar, the baht fell 0.4 percent to 37.45 at 11:32 a.m. in New York, from 37.29 late yesterday.

``The baht will come under more pressure'' after Asian financial markets open, said Marios Maratheftis, a currency strategist at Standard Chartered Plc in London. Even if any attempted takeover of the government ``doesn't go through it will be negative for the baht. The political uncertainty is there and the impact'' will continue, he said.

Shares of Thai Fund Inc., managed by Morgan Stanley, fell as much as 6.6 percent in New York Stock Exchange composite trading at 11:35 a.m.

Thailand, which hasn't had an elected parliament since February, has had 19 coups in the past 60 years.

To contact the reporter on this story: Laurent Malespine in Bangkok at lmalespine1@bloomberg.net.

Last Updated: September 19, 2006 12:07 EDT