Fitch Ratings on Thursday downgraded Egypt's debt grade by one notch, the third major agency to do so in as many days, citing the violent protests' consequences for the economy and public finances.

Fitch, whose downgrade follows similar moves this week by Moody's Investors Service and Standard & Poor's, warned that a continuation in the violence between pro- and anti-government protesters could lead to another ratings cut.

"The downgrade reflects the significant intensification of unrest, at the start of what is likely to be a volatile transition to a new government, and the increasingly negative consequences for the economy, public and external finances of the continuing disruption," said Richard Fox, head of Middle East and Africa Sovereign Ratings at Fitch.

He noted there remains a large gap between protestors' demands and the government's position on political reform, "which risks the political and economic situation deteriorating further before a resolution is agreed."

Fitch's report noted that Egypt's economy has already suffered from the turmoil, and that business activity will fall sharply and unemployment will rise.

It also warned that the economic impact could be even more severe if investors start to pull out capital and households and companies decide to pull their money out of the banking system.

Fitch lowered Egypt's long-term foreign currency issuer default rating to BB from BB-plus and the long-term local currency rating to BB-plus from BBB-minus.