CHINA CURRENCY

The Chinese currency is officially known as the Renminbi (RMB) and is denominated in yuan (or kuai), jiao (or mao) and fen (1 yuan = 10 jiao = 100 fen). It is denoted as CNY.

History
The first series of Renminbi banknotes was introduced in December 1948, a year before the founding of the People's Republic of China. In Chinese, renmin means people and bi means coin or banknote. To date, five series of the Renminbi have been introduced. The latest fifth series, introduced in 1999, has banknotes for 1, 5, 10, 20, 50 and 100 yuan and coins for 1 jiao, 5 jiao and 1 yuan. The People's Bank of China, the nation's central bank, is the only institution that has the power to print and mint the Renminbi.

Use
The Renminbi is the legal tender in mainland China and is sometimes accepted in Hong Kong and Macau, which are special Chinese administrative regions that have their respective legal tenders. The Renminbi is unofficially used in Taiwan, North Korea, Mongolia and Southeast Asian countries bordering China, particularly for trade. To strengthen the Renminbi as an international reserve currency, China has agreements with Russia, Vietnam, Thailand and Japan allowing bilateral trade to be settled directly in the Renminbi.

Value
In 1994, the Renminbi was devalued and began a long-time peg at around 8.3 yuan per US dollar to make Chinese exports cheaper. In July 2005 the peg was lifted with a slight appreciation to 8.1 yuan per dollar. The Renminbi has gradually appreciated to between 6.8 and 6.9 yuan per dollar in July 2008, when China re-pegged it as the global financial crisis intensified. In June 2010, China said it would adopt a managed floating exchange rate regime by allowing a thin daily trading band. Over recent years the government has kept a loose lid on the Renminbi's gradual appreciation in a move to tame rampant inflation. The Renminbi's intermediate rate against the dollar was 6.28 as of the end of 2012. By and large, it is widely believed that the Renminbi is still greatly undervalued.

Personal Exchange
Starting January 2010, Chinese and non-Chinese citizens are allowed to exchange a maximum of $50,000 USD annually, with a maximum daily withdrawal of $10,000 and a maximum daily purchase of $500. This tough management leads to strong demand for exchange in both directions and is viewed as a major means to prevent hot money influx.

Renminbi Exchange Rate Per US Dollar
2012: 6.286
2011: 6.459
2010: 6.769
2009: 6.831
2008: 6.939
2007: 7.522
2006: 7.974
2005: 8.192
2004: 8.277
2003: 8.277
2002: 8.277
2001: 8.277
2000: 8.279
1999: 8.278
1998: 8.279
1997: 8.290
1996: 8.314
1995: 8.351
1994: 8.619
1993: 5.762
1992: 5.516
1991: 5.323
1990: 4.783
1989: 3.765
1988: 3.722
1987: 3.722
1986: 3.453
1985: 2.937
1984: 2.320
1983: 1.976
1982: 1.893
1981: 1.705
1980: 1.498
1979: 1.555
1978: 1.684


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