UPDATE 1-IMF mission to visit Egypt in early April for loan talks

WASHINGTON, March 28 (Reuters) - The International Monetary Fund said on Thursday it would visit Egypt in the "first days of April" for talks with the government on a possible financing programme worth $4.8 billion.

More than two years of political upheaval have battered the Egyptian economy, leaving the country in dire need of IMF funding to relieve a currency and budget crisis. The deal would also unlock billions of dollars in further support for Egypt from other donors.

IMF spokesman Gerry Rice confirmed the visit. In Cairo, government spokesman Alaa El Hadidi said the IMF would return "some time next week".

President Mohamed Mursi's government initialed a deal with the IMF last November but postponed final ratification in December in the face of unrest triggered by a political row over his powers.

Masood Ahmed, director of the IMF's Middle East and Central Asia department, visited Cairo on March 17, saying the Fund would continue talks aimed at agreeing possible financial aid.

The government sees Egypt's budget deficit hitting 10.9 percent of GDP in the year to the end of June, assuming it carries out economic reforms to curb spending. Without such reforms, the government says the deficit will hit 12.3 percent of GDP.

Cairo has been reluctant to impose tough austerity measures which an IMF deal may require, for fear of igniting further unrest.

However, Egyptian Planning Minister Ashraf al-Araby said last week that he expected Cairo to sign a deal with the IMF by the end of June and to have received the first tranche of a loan by then.