Analysts at consultancy GK Dragonmics applaud Beijing's resistance to a spending splurge as a sign that coddled state-backed firms should stop expecting handouts at the first whiff of economic woe.

They say a minor counter-cyclical boost is all the current downturn needs. A softly-softly approach is clearly underway.

Fiscal data for the first four months of 2012 shows year on year central government spending growth of 26.2 percent, more than twice the 12.5 percent growth in revenue.

The last time spending outpaced income in the first four months was 2009 when it jumped 31.7 percent year on year and revenue fell 9.9 percent.

Spending on education is up 31.3 percent to 468.6 billion yuan. It's up 17.7 percent on social security and job creation at 457.9 billion yuan. Agriculture spending is up 35.7 percent to 278.9 billion yuan. Transportation spending - a risk area from 2009's stimulus - is up 84.5 percent to 197.1 billion yuan. And 70.7 billion yuan has been spent on affordable housing.

Meanwhile budget allocations for fixed asset investment projects jumped 40 percent year on year in March and April.

No fiscal fanfare

It has all been done without fanfare.

"Fiscal spending is about 20 percent of GDP, so that's about 10 trillion yuan. If you want to bring 1 trillion yuan a little bit forward, that would be fine. It seems like a big number, but for China it's not," said Ting Lu, China economist at Bank of America/Merrill Lynch in Hong Kong.

Which means the undershoot of April's economic activity and new lending numbers versus expectations could be quite transient, despite triggering a raft of downgrades to growth forecasts for Q2 and the full year.

The benchmark Reuters poll saw estimates for China's annual rate of GDP growth in Q2 scaled back to 7.9 percent from 8.3 percent before the data. Economists now expect 2012 growth of 8.2 percent versus 8.4 percent, though still comfortably above the government's 7.5 percent growth target.

Those calls may be too pessimistic, even if lagging data suggests that world's second biggest economy has not yet hit a cyclical bottom.

Nomura's China Compass, a proprietary leading indicator of nine gauges of economic activity, ticked up on the April data - its fifth consecutive monthly rise.

"The signal seems to be that a recovery is underway and that's probably one reason why the government is reluctant to loosen policy further," Zhang Zhiwei, chief China economist at Nomura, told Reuters.

"I think there's more in the pipeline, but it will take another couple of months to arrive," Zhang said. "But is that going to be enough to turn growth around, particularly with what's happening in Europe? That's the big question for investors."