China is on holidays – Goldman Sachs take the opportunity to shrug off all the stimulus

Via a Goldman Sachs note, analysts there say all the excitement over Chinese stimulus measures is a tad misplaced, they only expect a 40bp boost to GDP.

There is no doubting the impact on sentiment, Chinese equities exploded higher right through until the holidays started on Tuesday (China reopens on October 8 – its long holiday).

GS add that the impact of recapitalising banks:

• Reports that China is considering injecting US$142bn of capital into top banks

is unclear, it’ll depend on how much a boost there will be lending.

Really, I am not too surprised by this modest expectation from GS. It wasn’t only me asking where the fiscal stimulus was. Right before we were all run over by the freight train of equity buying 😉

This article was written by Eamonn Sheridan at www.forexlive.com.