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What is Difference Between Renminbi (RMB) and Yuan - Chinese Currency

 

 

 

 

 

What does RMB stand for ? RMB is abbreviation for  Ren Min Bi,  when loosely translated into English means People's Money / notes.

 

 

 

Which is the official currency of China : RMB is  the official currency  in China.

What is the base unit for RMB : Yuan is the base unit for RMB - just as Dollar in USD. This is the currency system in China.  The currency system in China is given below vis-a-vis US Dollar:-

 

 

US Dollar  =           RMB

Cent           =             Fen

 

Dime          =             Jiao

Dollar         =            Yuan

 

 

 

Thus, we can say that Yuan and RMB is not always the same (as Yuan is just one of the currency units in RMB), but they are frequently interchangeably used because   when we say  500 RMB or 500 Yuan, this means it  is exactly the same amount of money.

 

 

The above indicates that we should say that, "China may revalue the Renminbi,", but it would be not proper to say that "China may revalue the yuan".    Similarly, we should say  "Average wages in Chinese manufacturing are 900 yuan per month", but it would not be proper to say that "This bun bao costs 5 RMB"  .

 

 

We can also say that the difference between Yuan and Renminbi is similar to as difference between Pound and Sterling.  Yuan is the unit of measuring the Renminbi (similar to pounds and pence are units for measuring sterling).


 

 

Another easy way to remember the difference between RMB and Yuan will be to consider the following:.



- if you're outside china and talking about chinese currency, call it the renminbi.


- if you're inside china, and talking how much an item costs, call it the yuan.

Somebody has well said that if you in US would say that something costs "two bucks", then if in China the shop-keeper will say it costs  "two yuan".

 

 

MORE ABOUT CHINESE CURRENCY :

 

Thus, we can say that official Chinese currency is known as Renminbi.   This is issued by People's Bank of China and is the sole legal tender in China.    As given above, the unit of Renminbi is yuan and the smaller, jiao and fen. The conversion among the three is: 1 yuan = 10 jiao =100 fen. 

Chinese people often refer to Yuan as Kuai, Jiao as Mao.

RMB is issued both in notes and coins.

Denominations of paper notes include :- 100, 50, 20, 10, 5, 2 and 1 yuan; 5, 2 and 1 jiao;

The denominations of coins are 1 yuan;   5, 2 and 1 jiao; and  5, 2 and 1 fen

The Renminbi (RMB, sign: ; code: CNY; also CN•,)

 

 

 

Banknotes

 

Freq. used

•1, •5, •10, •20, •50, •100

Rarely used

•0.1, •0.2, •0.5, •2

 

Coins

 

Freq. used

•0.1, •0.5, •1

Rarely used

•0.01, •0.02, •0.05

 

 

Like most of  other currencies, the value of the renminbi has been traditionally pegged to the U.S. dollar.  Over the years,  China transited from central planned economy to a free market economy, and its share in the foreing trade increased,  the renminbi was devalued to increase the competitiveness of Chinese industry.  It is believed that by not allowing renminbi to free float,  the current official exchange rate is lower than the value of the renminbi by purchasing power parity, undervalued by as much as 37.5%.

 

 

Indicative Exchange Rates as on 28th September, 2011:

 
 

Currency Unit = 100

RMB

US dollar

636.23

   
Euro

863.24

   
Japanese yen

8.3151

   
HK dollar

81.61

   
British pound

993.82