China’s inflation continued to moderate in September, though food prices remained stubbornly high. China’s consumer price index in September rose 6.1 percent, a slight decrease from the August reading of 6.3 percent and down from the three-year peak of 6.5 percent reached in July. However, food prices rose by 13.4 percent in September, the same rate of growth as August, suggesting that China’s central bank will not loosen its monetary policy in the next two months, analysts said. Prices for pork, a staple meat in China, rose 43.5 percent year over year in September, only slightly down from the 45.5 percent rise in August. China has raised interest rates five times and hiked banks’ reserve requirements nine times since October 2010 in a bid to cool its economy and keep the lid on rising prices.

China’s foreign-exchange reserves grew only slightly in the third quarter, suggesting that investors shifted funds to safe-haven investments amid global economic uncertainty. China’s foreign-exchange reserves grew by USD4.2 billion in the third quarter, compared to USD152.8 billion the previous quarter. The country’s reserves fell by USD60.82 billion in September, the first decline since May 2010. Analysts said that slowing growth of the country’s foreign exchange reserves and a narrowing trade surplus would help China counter accusations that its currency is undervalued. At the end of September, China had accumulated USD3.202 trillion in foreign exchange reserves, the world’s largest stockpile.

A gauge of Hong Kong-listed Chinese stocks surged after the Chinese government intervened in its domestic markets. The Hang Seng China Enterprises index has jumped 21 percent since Oct. 4, led by financials, metals and infrastructure-related stocks. On Oct. 10, China’s state-run Central Huijin Investment began purchasing shares in the country’s Big Four banking giants in a bid to restore confidence in the country’s floundering equity markets. The Hang Seng China Enterprises index lost 29 percent in the third quarter alone, on fears of a hard landing for China’s economy and hidden loans in the country’s banking system. It was the worst quarterly loss for the index in 10 years. The recent surge for the index has trimmed the yearly loss to 23 percent.

China’s copper imports in September reached a 16 month high of 380,526 tonnes and iron ore imports climbed to 61 million tonnes, the highest level since January. However the country’s oil imports decreased by 12 percent year over year to 5 million barrels per day. The recently released data suggests that China’s demand for commodities is beginning to increase after a slow start to the year. Imports of iron ore are crucial for steelmaking and viewed as a proxy for broader economic activity.

The US Congress on Wednesday approved a free-trade agreement with South Korea, Colombia and Panama. The free-trade agreements were drafted during the George W. Bush administration but had been strongly advocated by President Obama. Critics said that the deals would harm US employment figures, but the Obama administration said the deals would create tens of thousands of jobs. The free-trade agreement with South Korea is the biggest such deal since the North American Free Trade Agreement took effect in 1994.