*Industrial output falls 20.9 pct
*Better data possible in coming months
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ANKARA, May 8 (Reuters) - Turkey's industrial production fell for an eighth consecutive month in March, but not by much as expected, official data showed on Friday, prompting hopes of a possible recovery in the second quarter.
Industrial production fell 20.9 percent in March due to a steep fall in exports and weak demand at home during the global economic crisis.
The median forecast in the survey of 13 economists at banks and brokerages in Istanbul was for a 22.9 percent year-on-year fall in output, in pace with falls in January and February.
"The fall in industrial production stopped in March and bellwether indicators including manufacturing industry confidence index make us think that a recovery may start in the coming months," Fortis bank economist Erkin Isik said.
Industrial production, which includes output at all Turkish factories and mines, makes up almost a third of the country's gross domestic product. The International Monetary Fund expects the Turkish economy to shrink 5.1 percent this year.
Record high unemployment and criticism of a slow response to the crisis prompted a government reshuffle last week that saw a third of the cabinet sacked and an economic tsar appointed to prop up growth and possibly conclude talks on an IMF bailout.
Economists said Friday's figures show the fall in industrial production lost speed, but indicated industrial production in March 2008 rose by just 2.6 percent, constituting a low base.
"We predict that the gross domestic product contracted 12.5 percent in the first quarter. I do not expect industrial production to continue falling at this speed in the second quarter," said Yatirim Finansman chief economist Levent Durusoy.
Output fell 23.8 percent in February and 21.3 percent in January. The economy shrank 6.2 percent in the fourth quarter of 2008, according to the latest official available data, its first contraction since 2001. (Reporting by Selcuk Gokoluk; editing by Chris Pizzey)