By Adam Rose
BEIJING (Reuters) - China is forecast to have grown at its slowest rate in five years in the first quarter, a Reuters poll shows, with the slow start to 2014 already prompting government action to steady the world's second-largest economy.
The economy is expected to have grown 7.3 percent in the January-March quarter from a year earlier, according to the median forecast of 25 economists polled by Reuters, after growing 7.7 percent in the final quarter of 2013.
If realised, it would be the slowest annual growth since the first quarter of 2009, in the immediate aftermath of the global financial crisis, when gross domestic product grew 6.6 percent.
Back then, Beijing unleashed a 4 trillion yuan (388 billion pounds) stimulus package to shore up growth.
Stimulus measures this year are expected to be far more modest and targeted. Analysts think the support will be enough to steady growth near the government target of 7.5 percent, but without disrupting authorities' push to restructure the economy.
"Downward pressure may linger into the second quarter," Citi economists said in a report.
"With the job market stable and exports expected to strengthen, we do not anticipate big policy stimulus. Instead, the government may fine-tune policies in the second quarter to keep growth above 7 percent."
The first support steps were announced on April 2, when the government said it would accelerate construction of rail projects and cut taxes for small firms.
Some government economists thought new spending was already underway before that announcement, after a run of weaker-than-expected data this year showed the economy losing more momentum than had been expected.
The first-quarter GDP data will be released on April 16.
BETTER IN MARCH?
Monthly data is expected to show some pick-up in March as activity returns to normal after the Lunar New Year holidays, the poll found, although demand remains uncertain and surveys show manufacturing is still struggling.
"This year's post-Chinese New Year domestic demand recovery appears weaker than usual," UBS economists said in a note.
Exports are expected to have risen an annual 4.0 percent in March, after plunging 18.1 percent in February, while import growth is forecast to slow to an annual 2.4 percent.
That would lead to a small trade surplus of $900 million, a sharp turnaround from February's deficit of $23 billion. The trade data will be released on April 10.
Industrial output is forecast to grow 9.0 percent, investment by 18.1 percent and retail sales by 12.1 percent in March, all slightly stronger than their growth rates for January-February. To smooth out the impact of the variable dates of the Lunar New Year holidays, China releases combined January-February data for some indicators.
The forecast improvement in the March activity indicators, due on April 16, may take the edge of the weak start to the first quarter.
"There is a good chance that the first quarter will turn out not to have been the washout many fear," Capital Economics analysts said in a note.
Consumer inflation is expected to rise to 2.5 percent from 2.0 percent in February, while the producer price index is expected to have dropped 2.2 percent, a 25th straight fall. The inflation data is due on April 11.
New loans are expected to have risen by about 50 percent to 1 trillion yuan in March, extending a volatile start to the year. New loans fell to 664.5 billion yuan in February, about half of January's 1.3 trillion yuan.
Growth in broad M2 money supply is set to dip slightly in March to 13.0 percent, according to the poll.
China's foreign exchange reserves expected to grow to $3.92 trillion, up from $3.82 trillion in December.
(Editing by John Mair)