Thai Prime Minister Prayuth Chan-ocha said on Friday he had prepared a decree seeking to dissolve parliament ahead of an election, an expected step as his government heads into the last week of its four-year term.

The decree would require approval of Thailand's monarch and would take effect once published in the Royal Gazette. An election must take place 45-60 days after dissolution.

"I have prepared (the decree), we have to wait. We have to wait for the announcement in the Royal Gazette," Prayuth told reporters in the northern city of Chiang Mai.

Asked when this would be, he said: "We have to wait, wait for the announcement."

The election will again pit the billionaire Shinawatra family against parties backed by the military and old money conservatives, in what has been a bitter, 18-year power struggle in Southeast Asia's second-biggest economy.

Prayuth, a retired general who has been in charge since leading a coup against the government of Yingluck Shinawatra in 2014, will run under the new United Thai Nation party.

He will be up against Paetongtarn Shinawatra, the daughter of former premier Thaksin Shinawatra and Yingluck's niece. Paetongtarn, 36, has led Prayuth in opinion polls for months on the top choice for Thailand's next prime minister. (Reporting by Panarat Thepgumpanat, Panu Wongcha-um and Juarawee Kittisilpa Writing by Martin Petty Editing by Frances Kerry)