(Bloomberg) — China’s equity benchmark rallied by the most since July as signs that policymakers are stemming commodity price increases calmed inflation concerns. The nation’s currency also advanced, touching its highest since 2018.

The CSI 300 Index closed 3.2% higher to the strongest since early March, driven by consumer staples shares. The surge came as overseas investors net purchased 21.7 billion yuan ($3.4 billion) worth of A shares via the links with Hong Kong on Tuesday, the most ever.

Among the biggest gainers, liquor giant Kweichow Moutai Co. rose 6% a day after Chinese media outlets reported its parent company aimed to double revenue by 2025. A sub-gauge of consumer staples shares rose 4.5%, the most in four months, led by Luzhou Laojiao Co. with a gain of 7.3%.

Tuesday’s breakout higher follows Beijing’s efforts to talk down commodity prices and impose more control over financial markets as the 100th anniversary of the Communist Party approaches. Authorities have had some success in slowing metals prices recently, helping ease investor fears about inflation and further policy tightening.

“Beijing’s crackdown on commodity prices has forced more funds to seek shelter,” said Zhang Gang, Central China Securities strategist. “Stocks such as Moutai are attractive given its stable earnings outlook and relatively reasonable valuation following this year’s correction.”

Meanwhile, the offshore yuan climbed 0.2% against the dollar, breaching the 6.4 level to its strongest since June 2018. The Chinese currency has rallied 2.4% this quarter, making it one of the best performers in Asia. The advance has been fueled by weakness in the dollar, which is near a three-year low.

“The 100-year anniversary of the CCP is coming soon, so people are optimistic about policy direction,” said Shen Zhengyang, a strategist at Northeast Securities Co. “There are solid reasons to support such optimism. The market now believes the liquidity conditions will be maintained at a relatively ample level until the anniversary.”

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Financial stocks were also among the best performers, with a Bloomberg gauge of brokerage shares rising as much as 4.2%. The gains came as Shanghai announced plans to establish itself as an asset management hub. CSC Financial Co. rose by the daily 10% limit.

“Sentiment has stabilized and some heavyweight stocks have corrected from their intra-year highs,” said Linus Yip, chief strategist with First Shanghai Securities. “It’s not surprising that some long-term institutional investors will buy them at current levels.”

(Updates throughout. An earlier version was corrected to say the CSI 300 index rallied the most since July)

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