* Sudan struggling with high inflation, weakening currency
* Activists want to use discontent to spark broader uprising
* President dismissed demonstrations as insignificant
KHARTOUM, June 25 (Reuters) - Sudanese police used teargas to disperse anti-government protesters in an impoverished eastern region on Monday, witnesses said, as demonstrations fueled by an economic crisis continued to break out outside the capital.
Small demonstrations have spread across the country for more than a week, provoked by government moves to cut spending, scale back fuel subsidies and take other austerity measures to plug a widening budget gap.
About 200 protesters gathered in the town of Gedaref, near the border with Eritrea, c hanting "No, no to high prices" and "the people want to overthrow the regime" on Monday, two witnesses told Reuters.
The police were not immediately available to comment.
The most widespread protests so far broke out on Friday in neighbourhoods across Khartoum and expanded beyond the core of student activists who had dominated them.
Sudan's President Omar Hassan al-Bashir on Sunday dismissed the demonstrations as the work of a few agitators whose aims are not shared by the majority of Sudanese.
Although the capital has been relatively quiet since a security crackdown on Saturday, activists have continued to try to use discontent over the economy to build a broader movement to end Bashir's 23-year rule.
A number of students from the University of Khartoum faculty of medicine tried to stage a demonstration in the city centre on Monday. But a heavy security presence stopped the protest gaining any momentum, a witness said.
Late on Sunday, police also used batons and teargas to break up a protest in the al-Jerief area in eastern Khartoum after demonstrators blocked a major road, burned tyres and chanted slogans against high prices, witnesses said.
Sudan's economy - already reeling from years of conflict, U.S. trade sanctions and mismanagement - was hit hard by the secession of oil-producing South Sudan a year ago.
The new nation took about three quarters of the country's oil output, previously Sudan's main source of foreign currency, exports and state revenues.
The left Sudan with a mounting budget deficit, a weakening pound and high inflation in the prices of food and other goods, many of which are imported.
The two countries were supposed to work out a deal in which landlocked South Sudan would pay Khartoum fees to export its oil via pipelines and other facilities in Sudan, but the two failed to reach an agreement.
South Sudan shut down its oil output in January after Khartoum started confiscating some crude. (Reporting by Khalid Abdelaziz; Writing by Alexander Dziadosz; Editing by Andrew Heavens)