It’s China GDP time—here's what to expect
China releases its highly-anticipated economic growth data for the fourth quarter on Monday – numbers that are expected to show 2013 marked the weakest performance for the world's second biggest economy in 14 years.
Many economists forecast China's annual gross domestic product (GDP) slowed to 7.6 percent in the final three months of last year, from 7.8 percent in the previous quarter.
Analysts told CNBC that this would put the full-year growth rate at around 7.7 percent, above the government's 7.5 percent official target but mark the weakest level since 1999.
(Read more: Global economy at a turning point: World Bank)
"Ironically, whatever number the government comes out with, the market will probably view it negatively," David Cui, head of China equity strategy at Bank of America Merrill Lynch, told CNBC Asia's "Cash Flow" on Friday.
"Right now, you have to say the market is in quite a negative frame of mind. So if it [the GDP data] comes way above consensus, people will say the government has to tighten [monetary policy], look how fast credit has been expanding," he added. "If it's too low, people will say, wow things are going badly I better not get too involved [in stocks]."
The Shanghai Composite stock index was one of the worst performing major world stock markets last year. It has started this year on a weak note, falling about 4.4 percent since the start of January.
Recent data out of China suggest economic growth slowed in the final months of 2013. December exports rose 4.3 percent from a year earlier, down from a 12.7 percent rise in November, while manufacturing surveys have pointed to weaker activity in the sector.
(Read more: China outstrips US as world's biggest goods trader)
"We forecast Q4 GDP will expand 7.6 percent year-on-year, bringing 2013 full-year growth to 7.7 percent year-on-year," analysts at Barclays said in a research report released last week.
"Both the NBS [National Bureau of Statistics] and HSBC PMIs showed broad-based declines in December, and the business sentiment indicator continued its downtrend, pointing to an ongoing easing in growth momentum," they added.
Beijing has yet to officially set its 2014 growth target but according to media reports and economists the target is expected to remain unchanged at 7.5 percent.
Analysts say slower economic growth rates are inevitable as China's leaders wean the economy off a heavy reliance on exports and investment towards a more sustainable expansion in consumption.
Weaker economic growth in the first half of this year is also likely to stem from government efforts to rein in credit growth, economists said.
Rampant credit growth, fuelled by shadow banking activity, is seen as a major risk to China's economic outlook, with Beijing taking steps in recent months to address the issue.
(Read more: Can China contain high government debt)
There are reasons to be optimistic, said Louis Kuijs, China economist at RBS in Hong Kong.
"If the global economy picks up this year, then that paints a pretty good picture for China and a favorable backdrop for the government to act and rein in credit growth," he said.
— By CNBC.Com's Dhara Ranasinghe; Follow her on Twitter @DharaCNBC