The U.S. economy grew at a scant 0.7 percent annual rate in the first quarter of the year as both businesses and consumers concentrated more of their spending on imported goods, the Commerce Department reported yesterday.

Senior Reagan administration officials yesterday predicted a better economic performance this quarter, but said the growth rate still would be "sluggish."

The 0.7 percent rate in the gross national product was revised downward from last month's preliminary estimate of 1.3 percent by the Commerce Department. All of the numbers are adjusted for inflation and seasonal variations.

Moreover, most of the increase reported yesterday represented goods that went into business inventories rather than being sold. Actual final sales of goods and services to consumers, businesses and governments rose only a minuscule 0.1 percent, the department said.

Meanwhile, the Labor Department reported that consumer prices went up 0.4 percent in April, with more than half the increase attributable to substantially higher prices for gasoline and home heating oil. Food prices fell 0.2 percent during the month.

Prices on the stock market were mixed following release of the economic reports. The Dow Jones industrial average broke its day-old record by rising another 4.82 points to 1309.07 after Monday's 19.54-point rise. But other market averages finished with modest losses. In foreign-exchange trading, the dollar closed lower.

The small increase in real GNP in the winter quarter followed gains of 4.3 percent in the fourth quarter of 1984 and 1.6 percent in the third. Thus, in the last three quarters, the economy has expanded at an average 2.2 percent annual rate, compared with a 7.1 percent pace in the 18 months of recovery prior to that.

Despite the sharp slowing of growth, only a few economists expect the economy to fall into a recession.

Most forecasters, pointing to some unusual developments that depressed the first-quarter figures, predict a healthier expansion later this year. However, a rising number of economists now believe a recession will hit sometime in 1986.

At the White House, spokesman Larry Speakes said, "Despite the downward revision, all advance economic signs point upward, and prospects for renewed growth are good. . . . We remain convinced that, if the Congress follows the Senate's lead of reducing fiscal year 1986 deficits by over $50 billion, the economy will pick up markedly."

Robert Ortner, chief economist for the Commerce Department, also predicted better times are ahead: "Where we have been so far this year is nothing to get excited about. We barely had any growth. I am not going to alibi it. It was a poor quarter." But Ortner, ticking off some evidence of underlying strength in the economy, declared that the poor quarter was "not a sign of a recession. I think we will have a stronger second half and probably a stronger 1986 than 1985. None of the signs of recessions are present."

The April increase in the consumer price index was slightly less than the 0.5 percent rise in March. However, the CPI has risen at a 4.9 percent annual rate over the last three months, the fastest rate in more than a year.

The acceleration in inflation also was reflected in the Commerce report, which showed prices as measured by the GNP implicit price deflator rising at a 5.6 percent rate in the first quarter instead of the 5.3 percent rate reported earlier.

The implicit deflator is affected by quarter-to-quarter changes in the composition of the mix of goods and services produced as well as changes in prices.

A separate fixed-weighted index that is not affected by changes in that mix rose at a 4.6 percent rate, an upward revision from 4.4 percent.

In the fourth quarter of 1984, the implicit deflator rose at a 2.8 percent rate; and the fixed-weighted index, at a 3.6 percent rate.

Before adjustment for inflation, Commerce estimated that the GNP ran at an annual rate of $3.817 trillion in the first quarter.

Treasury Secretary James A. Baker III, testifying at a Senate appropriations hearing, said the first-quarter economic growth was "slower than we anticipated," adding that administration officials also expect to "see a less strong second quarter" than they had hoped. But Baker maintained that the weaker figures for the first half of the year don't "mean that we won't achieve overall growth for the year. The economy will strengthen considerably in the third and fourth quarters" and there will be no recession, he said.

Ortner noted that consumer spending rose at a strong 5.2 percent rate in the first quarter after adjustment for inflation. In addition, he said, housing construction is rising again this quarter, and federal purchases of goods and services, which fell in the first three months of the year because of an unusual drop in defense outlays, should be up, too.

Businesses also appear to have made most, if not all, of the necessary adjustment of their inventory levels to the slower rate of increase in demand, he said.

But most of all, there is no reason to expect another quarter that will be so hard hit by a surge in imports, Ortner stressed. Imports shot up at a 31.4 percent rate in the first quarter, while exports fell at a 6.1 percent rate. That swing was almost enough to offset the gains in consumer spending and a large shift by businesses from reducing their inventories sharply to adding to them modestly.

However, Ortner, like Baker, also said that the second quarter is not off to a good start, based on April data.

Economists attribute much of the trade problem to an overly strong U.S. dollar on foreign exchange markets. If the dollar, which has been declining, "comes down substantially more, then '86 could be a much better year than '85," Ortner predicted.

Ortner's comments are echoed by a number of private economists, including Allen Sinai of Shearson Lehman Brothers, who, if anything, is more optimistic about the economy's longer-term outlook.

Sinai thinks that trade problems could continue to depress economic activity in the second half of 1985, before an easier monetary policy from the Federal Reserve, a decline in the dollar and congressional action to reduce budget deficits provide a better basis for growth in 1986.

"The picture for next year is improving," Sinai said. "The budget is being tightened and, at the same time, we are getting some easing in monetary policy. . . . I think the monetary policy fulcrum can dictate whatever growth in real GNP is desired."

Some other economists, while expecting continued growth this year, believe that a combination of problems and the sheer aging of the recovery that began 2 1/2 years ago will produce a recession in 1986. For instance, a majority of the members of the National Association of Business Economists now hold that view, it was reported this week.

In the Labor Department's report on consumer prices, motor fuels prices were up 3 percent after a 3.6 percent increase in March. Fuel oil prices rose 3.3 percent following a 0.6 percent increase the month before.

Grocery store prices fell 0.4 percent, the second monthly decline in a row. The indexes for meats, poultry, fish, eggs, fruits and vegetables and dairy products all went down.

Among the other major components of the CPI, only medical care, which rose 0.6 percent in April, went up faster than the overall index.

The April increases left the CPI at a level of 320.1, up 3.7 percent in the last 12 months. The index level means that the marketbasket of goods and services included in the CPI that cost $100 in 1967 now costs $320.10.