China will ease monetary policy and boost liquidity in the financial system with a series of measures, state media cited a central bank official as saying, in a bid to avoid a sharp economic slowdown.

The official Xinhua news agency quoted an unnamed official at the People's Bank of China as saying it planned to "steadily" introduce the measures, including cutting the amount of cash lenders must keep in reserve.

The report, published late Wednesday, comes as the world's number two economy eases, with data last week showing it grew at its slowest pace for almost three years in the January-March quarter, while manufacturing stutters.

As well as easing reserve requirements, the central bank will also boost liquidity through its open market operations -- referring to its sale or purchase of securities, which influences the volume of money and credit in the economy.

"The central bank will continue to implement a prudent monetary policy... and maintain a reasonable level of interbank liquidity to facilitate a stable and relatively rapid development of the national economy," the official said.

China will "fine-tune" its monetary policy to allow more growth in bank lending, the official added in the report, reiterating remarks by other officials about the need to adjust money policy.

A spokesman for the central bank declined to comment on the report.

The bank has already cut bank reserve requirements twice since December last year, as policymakers look to get money through to the small businesses and the agricultural sector that play a crucial role in the economy.

Chinese banks have already ramped up lending, issuing 1.01 trillion yuan ($160.3 billion) in new loans in March, higher than the 710.7 billion yuan recorded in February, figures showed last week.

Investors have been waiting for Beijing to announce measures to ease monetary policy for several weeks as figures show manufacturing activity almost dormant, while in February the country posted its biggest trade deficit in more than a decade.

Official data on Friday showed the economy grew just 8.1 percent in the first three months of the year -- well below the 8.9 percent recorded in the last quarter of 2011 -- marking the fifth consecutive quarterly slowdown.

"The current situation has provided the conditions to lower reserve requirements, chiefly lower-than-expected economic growth," Liao Qun, chief China economist for Citic Bank International in Hong Kong, told AFP.

Analysts widely expect China to move again to trim reserve requirements for commercial banks, with some predicting the government might even cut interest rates to kick-start the economy.

"The impact of lowering rates would be a bit bigger, so they will consider it in the second half," Liao said.

British banking giant HSBC expects reserve requirement cuts of one percentage point and more capital injection through open market operations in the April-June period, it said in a research report last week.

Analysts also say lower inflation has given the government more room to ease monetary policy. China's inflation rate hit 3.6 percent in March from 3.2 percent in February, but was still down from a peak of 6.5 percent seen in July.