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Inflation may have weakened in China in April, allowing more room for policy stimulus, and trade is likely to stay weak, analysts said.
The world's second largest economy still needs at least one reserve requirement ratio cut to bolster liquidity and sustain growth, despite some encouraging signs this month, analysts said.
A slew of key economic indicators will be announced this week.
The Consumer Price Index, the main gauge of inflation, may have expanded 3.4 percent in April, said Lu Zhengwei, chief economist at Industrial Bank. Bank of Communications economist Tang Jianwei predicted a 3.3 percent increase.
The index rebounded more than expected to 3.6 percent in March from the 20-month low of 3.2 percent recorded in February.
"Inflationary pressure is receding with lower global oil prices and cheaper pork," Lu said. "This can ease the worries of policymakers and allow a reserve requirement ratio cut, possibly this month."
Lu had forecast the central bank would cut the reserve requirement ratio last month.
Bank of Communications' Tang said China's series of price reforms may slow the process of price moderation, but they can't change the broad picture of weakening inflation.
But trade is likely to remain a weak point as both exports and imports may have delivered single digit growth in April.
Lu predicted exports to rise 7.8 percent last month, compared with March's 8.9 percent, while imports may improve a bit from 5.3 percent to 8.5 percent, but still far below February's 39.6 percent.
Tang was a bit more optimistic, anticipating exports to grow 7.9 percent in April and imports to climb 10.9 percent.
Earlier this month the official Purchasing Managers' Index, a comprehensive gauge of manufacturing activities in China, reached a 13-month high of 53.3 in April, reflecting reviving domestic demand.
