Â¥ or å…ƒThe renminbi (symbol: ¥; ISO code: CNY; abbreviation: RMB) is the official currency of the People's Republic of China and one of the world's most traded currencies, ranking as the fifth most traded currency in the world as of April 2022.
The yuan is the basic unit of the renminbi, but the word is also used to refer to the Chinese currency generally, especially in international contexts. One yuan is divided into 10 jiao, and the jiao is further subdivided into 10 fen. The renminbi is issued by the People's Bank of China, the monetary authority of China.
Until 2005, the value of the renminbi was pegged to the US dollar. As China pursued its transition from central planning to a market economy and increased its participation in foreign trade, the renminbi was devalued to increase the competitiveness of Chinese industry. It has previously been claimed that the renminbi's official exchange rate was undervalued by as much as 37.5% against its purchasing power parity. However, more recently, appreciation actions by the Chinese government, as well as quantitative easing measures taken by the American Federal Reserve and other major central banks, have caused the renminbi to be within as little as 8% of its equilibrium value by the second half of 2012. Since 2006, the renminbi exchange rate has been allowed to float in a narrow margin around a fixed base rate determined with reference to a basket of world currencies. The Chinese government has announced that it will gradually increase the flexibility of the exchange rate. As a result of the rapid internationalization of the renminbi, it became the world's 8th most traded currency in 2013, 5th by 2015, but 6th in 2019.
On 1 October 2016, the renminbi became the first emerging market currency to be included in the IMF's special drawing rights basket, the basket of currencies used by the IMF as a reserve currency.
Modern Chinese trace their origins to a cradle of civilization in the fertile basin of the Yellow River in the North China Plain. The semi-legendary Xia dynasty in the 21st century BCE and the well-attested Shang and Zhou dynasties developed a bureaucratic political system to serve hereditary monarchies, or dynasties. Chinese writing, Chinese classic literature, and the Hundred Schools of Thought emerged during this period and influenced China and its neighbors for centuries to come. In the third century BCE, Qin's wars of unification created the first Chinese empire, the short-lived Qin dynasty. The Qin was followed by the more stable Han dynasty (206 BCE–220 CE), which established a model for nearly two millennia in which the Chinese empire was one of the world's foremost economic powers. The empire expanded, fractured, and reunified; was conquered and reestablished; absorbed foreign religions and ideas; and made world-leading scientific advances, such as the Four Great Inventions: gunpowder, paper, the compass, and printing. After centuries of disunity following the fall of the Han, the Sui (581–618) and Tang (618–907) dynasties reunified the empire. The multi-ethnic Tang welcomed foreign trade and culture that came over the Silk Road and adapted Buddhism to Chinese needs. The early modern Song dynasty (960–1279) became increasingly urban and commercial. The civilian scholar-officials or literati used the examination system and the doctrines of Neo-Confucianism to replace the military aristocrats of earlier dynasties. The Mongol invasion established the Yuan dynasty in 1279, but the Ming dynasty (1368–1644) re-established Han Chinese control. The Manchu-led Qing dynasty nearly doubled the empire's territory and established a multi-ethnic state that was the basis of the modern Chinese nation, but suffered heavy losses to foreign imperialism in the 19th century.