The currency used in the People’s Republic of China is usually called Chinese yuan, however, the official name of the currency is actually called Renminbi. Yuan is the basic unit of Renminbi and also a name that has been used for many currencies in the region. At the moment, yuan is also the name of methods of payments used in Taiwan, Hong Kong, and Macao. 1 Chinese yuan is divided into 10 jiao and 100 fen.
The Chinese yuan is currently the 8th most traded currency in the world representing 4.0% of the daily share. Due to China’s enormous economy, the currency plays a major role on the international market but it is still heavily controlled by the Chinese government.
The Chinese currency is truly unique in the sense that it has different names and three different denominations (yuan, jiao, and fen) instead of the normal two (e.g. dollar and cent). It also has several different nicknames such as Grandpa Mao, kuài (块), and máo (毛).
Officially the currency is written as 人民币 (in traditional Chinese it’s: 人民幣) but it also has its own sign 元 in similarity with the dollar-sign: $. In the western world, the Chinese yuan is often shortened to RMB and the official code for the currency is CNY.
The Chinese yuan also has a second semi-official abbreviation, which is something completely unique in the world. The alternative abbreviation is CNH and we talk more about it below in the section titled “Trade Chinese Yuan.”
Chinese Yuan’s Denominations
To make things even more confusing, China has an unusually large number of valid denominations in circulation – 18 in total, 6 coins, and 12 bills. Some of them are quite old, others can only be found in certain parts of the country, and seven of them are rarely seen at all. Currently, the following coins and banknotes are used in China.
- 1 fen – very unusual and only available in certain regions
- 2 fen – very unusual and only available in certain regions
- 5 fen – very unusual and only available in certain regions
- 1 jiao
- 5 jiao
- 1 yuan
- 1 fen – very unusual and only available in certain regions just like the coin
- 2 fen – very unusual and only available in certain regions just like the coin
- 5 fen – very unusual and only available in certain regions just like the coin
- 1 jiao
- 2 jiao – only a small amount has been printed and can be hard to find
- 5 jiao
- 1 yuan
- 5 yuan
- 10 yuan
- 20 yuan
- 50 yuan
- 100 yuan
The coins have simple designs with the value on the obverse side and a flower on the reserve side.
All but the three smallest bills have Mao Zedong printed on the front along with a flower and the value. On the backside famous Chinese buildings and landscapes are depicted such as The Great Hall of People on the 100 yuan bill and The Li River on the 20 yuan bill.
On the three fen bills, faces of Chinese minorities have replaced Mao Zedong.
History of Chinese Yuan
China has experienced many different currencies throughout its history, especially during the imperial times when different currencies were often used at the same time. In the year 618 A.D. during the Tang Dynasty, China became the first country to introduce a currency with banknotes. At the same time, they also became the first country to start using a gold standard to insure their money.
The first modern currency to be introduced in China was the first Chinese yuan in the year 1912 when the Republic of China was founded. This happened after the Xinhai Revolution had overthrown the Qing Dynasty.
The new currency was used up until 1948 when the People’s Bank of China introduced the Renminbi roughly a year before the communist People’s Republic of China was formed.
The new Chinese yuan quickly experienced a hyperinflation that forced the Chinese government to reevaluate the currency at a rate of 1 CNY for 10,000 old yuan. Since then, the Chinese currency has gone through a few designs and name changes, but the currency itself has basically stayed the same. However, during this time period, China also transitioned from a planned economy to a market economy which has had dramatic effects on the exchange rate. Due to this, the CNY is still not completely a floating currency and is heavily controlled by the government.
Chinese Yuan Today
Today the yuan is more stable than ever before. In 2016, the RMB became the first emerging market currency to be included in the International Monetary Fund’s special drawing rights.
The CNY is controlled and regulated by the People’s Bank of China, but it is printed by a state-owned company called China Banknote Printing and Minting Corporation (CBPMC, or 中国印钞造币总公司)
Trade With Chinese Yuan
In 2016, CNY was the 8th most traded currency on the foreign exchange market. However, when it comes to trading the Chinese currency everything is completely unique.
Due to the Chinese government’s strict policies on currencies flowing in and out of mainland China, the RMB can be traded in two different versions with two different values and exchange rates. The two exchange rates are referred to as onshore yuan (CNY) which is heavily controlled, and the offshore yuan (CNH) which flows freely. There is also a Taiwanese version of the Chinese Yuan on the forex market with the code CNT.
Note that all the above-mentioned abbreviations are still technically referring to the same currency and the official ISO-4217 code is CNY.
The most common currency to buy and sell Chinese yuan with is the American dollar. The two currencies have had a long and close relationship to each other and thanks to the ever-growing trade between the two countries the bond keeps growing stronger.
You can use our professional currency converter to check the price for CNY/USD as well as USD/CNY right here on BullMarketz.com.