Chinese Renminbi

Name of currency: Chinese Renminbi

Country / countries used: China

Symbol: Renminbi ¥ Yuan 元

Brief history:

Renminbi (人民币) is the official national currency of the People’s Republic of China supplied by the monetary authority the ‘Peoples bank of China’ Renminbi translates literally to mean ‘peoples currency’ it is legal tender in the mainland only and not Hong Kong, which has the Hong Kong dollar, Taiwan uses the New Taiwan dollar or Macau who use the Macanese pataca.

When the Chinese first dealt in lots of silver, Spanish and Mexican coins were obtained through money exchange and trade and highly circulated throughout Asia and due to their circular shape they started to be referred to as ‘silver round’ this then filtered through to japan where the name stuck in the form of their ‘Yen’ whereas the Chinese used the mandarin pronunciation yuán.

Yuán (元) is the main unit of Renminbi (人民币), which is then subdivided by into Jiǎo (角) 1/10 and then again into fēn (分) 1/100. The denominations of bank notes range from 1 jiǎo to 100 yuán and the coinage consists of 1 fēn through to 1 yuán meaning that is one of the rare currencies where some quantities are represented in both paper and coin form.

The yuán is often referred to as the colloquial term ‘kuài’ 块 meaning lump, referring to a lump of silver originally. Bank notes in the yuán denomination were introduced from the 1890s by local and private banks but the earliest known introduction of silver coins, other than the Spanish and Mexican pesos that were regularly used as international money exchange swelled due to trade in silver, were manufactured at the Guangdong mint, the government did not start to issue their own coins of the yuán structure until 1903 as the demand grew.

Historically the Renminbi value as been pegged to the US dollar but as the participation in foreign trade grew, to increase the competitiveness of Chinese industries the Renminbi was devalued supposedly up to a staggering 37.5% lower than its ‘purchasing power parity’, although appreciation actions from the Chinese government, in addition to the ‘quantitative easing measures’ from the Federal Reserve and other main central banks which ultimately caused the Renminbi to come as close as 8% of its equilibrium value by the second half of 2012.