This way, China’s economic growth is benefited, once Chinese products become cheaper to export and the country becomes more competitive than others. “I sometimes think that the whole renminbi/yuan issue is a sinister plot by the Chinese designed specifically to deter people from discussing Chinese currency policy,” he joked. Integrating technology into China’s currency system, particularly with the introduction of the digital Yuan, presents both opportunities and risks. While it offers enhanced efficiency and security, it raises concerns about cybersecurity and data privacy.
As China became one of the world’s preeminent centres of finance and trade in the early 21st century, the renminbi rose as a global currency. In recognition of the renminbi’s elevated status, in November 2015 the International Monetary Fund (IMF) announced that the renminbi was to become one of its reserve currencies. Thus, it would join the U.S. dollar, the euro, the British pound sterling, and the Japanese yen as one of the IMF’s Special Drawing Rights currencies used for intergovernmental loans. For most of its early history, the renminbi was pegged to the forex broker listing U.S. dollar at ¥2.46 per dollar. During the 1970s, it was revalued until it reached ¥1.50 per dollar in 1980. When China’s economy gradually opened in the 1980s, the renminbi was devalued in order to improve the competitiveness of Chinese exports.
Who Owns the PBOC?
This is the “piece of eight” (or “real de a ocho”) beloved of pirates and their parrots – worth eight reales and known as a peso in Spanish and a dollar in English. Nor can you talk about the number of renminbi – or the number of sterling – to the dollar. In 1949, the Communist Party defeated the Kuomintang and Mao Zedong proclaimed the People’s Republic of China, making the renminbi the sole legal currency across the country. If you’re thinking this may be a potential loop-hole to where you can avoid exchanging for Chinese currency, don’t hold your breath as you need a Chinese bank account to use these apps. Should you receive fake notes in a taxi, ask for your receipt and also take note of the driver’s license plate before going your separate ways. Both pieces of information can help the police deal justice on your behalf.
The Chinese government continues to play a significant role in managing the currency, but it has also taken steps to allow it to float more freely on the foreign exchange market. This evolution reflects China’s growing influence in international trade and its strategic efforts to position the yuan as a key international currency. The ISO code for the renminbi is CNY, the PRC’s country code (CN) plus “Y” from “yuan”.14 Hong Kong markets that trade renminbi at free-floating rates use the unofficial code CNH.
The PBOC management team consists of a governor, six deputy governors, and a chief inspector. The term “Chinese yuan renminbi (CNY)” refers to the currency used in the People’s Republic of China. Although it may seem a little confusing because the names are often depicted together, they’re actually two separate terms. If you are looking to exchange Iranian rial into Chinese renminbi, it is important to note that Iran does hold the cheapest currency in the world. So, if you Cyber security stocks happen to hold any rial and are looking to exchange into Chinese currency, it might be difficult to facilitate. In the event you do receive counterfeit money, I’d take it directly to the nearest police station without starting a fuss with whoever gives it to you.
Interest rate and green bonds
They can easily manage the situation from there, especially if you received the bills from a black market currency dealer outside a bank. China’s official currency, the renminbi (RMB), can seem incredibly confusing to foreigners. Even the name “renminbi” is hard for a lot of people to pronounce correctly. In English, some people call it the Chinese “dollar.” In Chinese, there are three common names and two symbols in regular use.
It is even possible to spend an entire day paying for everything with a smartphone instead of cash. Even the owners of small vegetable stalls in traditional wet markets accept mobile payments. The Chinese Yuan has been pegged to the US dollar since 1994, keeping the currency devalued against other countries.
Physical Forms of the Yuan: Coins and Banknotes
The design of Chinese currency often incorporates significant cultural and historical symbols. For example, the portrait of Mao Zedong on the banknotes symbolizes the country’s revolutionary history and leadership. Other elements, such as images of the Great Wall, the Temple of Heaven, and various ethnic groups, highlight China’s rich cultural heritage and diverse society. These designs serve not only as a medium of exchange but also as a means of promoting national pride and unity.
- The latter was introduced to the country by the Communist People’s Republic of China at the time of its founding in 1949.
- Moreover, the Chinese government has been promoting the use of the digital yuan for international trade as a way to reduce the country’s reliance on foreign currencies and promote the use of the yuan as a global currency.
- The currency is managed by the People’s Bank of China, the country’s central bank, and has undergone significant reform and internationalization, reflecting China’s growing presence in global trade and finance.
- During the 1970s, it was revalued until it reached ¥1.50 per dollar in 1980.
- In fact, mobile payments have become so common that some merchants no longer keep enough small bills on hand to make change.
Is the Chinese Yuan Renminbi (CNY) a Free-Floating Currency System?
Chinese paper money comes in denominations of one, five, ten, twenty, fifty and one hundred. Whether you need to make cross-border payments or FX risk management solutions, we’ve got you covered. The number, which was presented in the 2021 RMB Internationalization Report , a research conducted by the International Monetary Institute (IMI), represented an astonishing increase of 54.2% compared to 2019. Consequently the Yuan became the third most internationalized currency in the world driven by the recovery of China’s economy, the boost in international currency cooperation, and financial sector opening-up. The modern Yuan (CNY) which is also called Renminbi (RMB) appeared with the foundation of the People’s Bank of China, being issued in 1949. The translation of Renminbi is “people’s currency” and new stages of the Yuan came afterwards, like in 1962 when a third version of the coin was issued.
Beginning in January 2010, Chinese and non-Chinese citizens have an annual exchange limit of a maximum of US$50,000. Exchanges within this limit require only a passport or Chinese ID and no additional documentation showing the purpose of the exchange. The maximum dollar withdrawal is $10,000 per day, the maximum purchase limit of US dollars is $500 per day. This stringent management of the currency leads to a bottled-up demand for exchange in both directions. It is viewed as a major tool to keep the currency peg, preventing inflows of “hot money”. Banknote printing facilities are based in Beijing, Shanghai, Chengdu, Xi’an, Shijiazhuang, and Nanchang.
From that point a series of events happened and, in 2019, the PBOC let the Yuan reach a threshold level of 7 to the US dollar. This level was a mark, because it was the first time that the Yuan had crossed the “7 limit” since 2008. The Central Bank of the People’s Republic of China (PBOC) is responsible for the Chinese Yuan / Renminbi management. The institution was established on December 1, 1948, in Shijiazhuang, Hebei Province, after consolidating former Huabei Bank, Beihai Bank and Xibei Farmers Bank.
Does Everyone Accept Cash? Mobile Payment Apps and Digital Currency Electronic Payment
The “yuan” refers to the unit of the RMB; it is akin to the “dollar” in the United States currency system, where the “dollar” is the unit of the U.S. dollar (USD). While “renminbi” is the official name, “yuan” is more commonly used in daily transactions. The distinction between the yuan and the renminbi, the historical context, and the various facets of China’s currency system are crucial for understanding the broader implications of dealing with Chinese currency. The renminbi, as the official currency, and the yuan, as its primary unit, play significant roles in both domestic and international financial contexts. The origins of China’s modern currency system can be traced back to the establishment of the People’s Bank of China (PBOC) in 1948.
These depict the national emblem on the obverse (front) and the name and denomination framed by wheat stalks on the reverse (back). In 1980, brass ¥0.1, ¥0.2, and ¥0.5 and cupro-nickel ¥1 coins were added, although the ¥0.1 and ¥0.2 were only produced until 1981, with the last ¥0.5 and ¥1 issued in 1985. All jiǎo coins depicted similar designs to the fēn coins while the yuán depicted the Great Wall of China. As of April 2025, the Chinese yuan has fallen to its lowest level vs. the U.S. dollar since 2007 amid an escalating U.S.-China trade war. The Chinese yuan lost value during the COVID-19 pandemic, largely due to reduced economic activity best pairs to trade forex and strict lockdowns. The yuan suffered its largest-ever monthly price drop in April 2022, losing 7% of its value over three months.
The increase of retail sales in both, rural and urban areas, and the opening-up policy adopted by the country fostered the application of reforms that positively impacted the currency. Thus, certain upgrades and breakthroughs in the design, style and printing technique happened to the Renminbi. When we talk about China we are referring to one of the world’s oldest and richest cultures which traces back thousands of years ago. The country was one of the pioneers to create currency in order to replace barter.
This innovation marked the beginning of using paper notes, which later became prevalent worldwide. The CNY went through a steady stream of appreciation against the greenback, leading the country to devalue its currency several times in 2015. Chinese leaders said this was part of the country’s market reform efforts.
Older fēn and large jiǎo coins are uncommonly still seen in circulation, but are still valid in exchange. Some economists believe that these controls keep the yuan artificially devalued, making the country’s exports more attractive. The word “yuan” is frequently used in Mandarin translations of foreign currencies. The character yuan is used for round or circular things in Mandarin Chinese. This word was also used for the silver Spanish dollars introduced by European merchants in the 17th and 18th centuries.
- In recent years, China has actively promoted the use of the yuan in global trade and finance.
- The renminbi, introduced in 1948, is abbreviated as RMB but it is not an official currency code.
- The institution was established on December 1, 1948, in Shijiazhuang, Hebei Province, after consolidating former Huabei Bank, Beihai Bank and Xibei Farmers Bank.
- If you plan to stay in China for an extended period of time, setting up a WeChat Pay or Alipay account will definitely make your life much easier.
- When reading news and analysis of this event, you might see both terms—“renminbi” and “yuan”—used interchangeably.
Use our currency converter to see how much your money is worth in Chinese yuan and familiarise yourself with the mid-market rate before your trip. When you’re buying currency for China, look out for the currency code CNY. In the second half of the 19th Century major trading nations starting producing their own “trade dollars”. An analogy can be drawn with “pound sterling” (the official name of the British currency) and “pound” – a denomination of the pound sterling. “Renminbi” is the official name of the currency introduced by the Communist People’s Republic of China at the time of its foundation in 1949. Along with printing the currency, the bank is responsible for monetary and fiscal policy as well as financial regulation in China.