USD/CNY – Rate, Chart, Analysis & News
USD/CNY is a Forex ticker that represents the price it will cost you in Chinese Yuan to buy 1 USD. FX currencies are shortened to three-letter abbreviations for ease and are called ISO codes. The Forex market trades in these currency pairs and have a quote structure of Base/Quote (USD/CNY).
The live USD/CNY rate is shown below in an interactive chart that you can use for technical analysis. Our real-time news and analysis will keep you up to date with factors affecting the price movements of USD/CNY, both fundamental and technical.
Recommended Forex Brokers to Trade USD/CNY
The USD/CNY pair represents the US Dollar against the Chinese Yuan. The Chinese Yuan is the currency of the People’s Republic of China.
There is a difference between the Renminbi and the yuan. Renminbi is the official name of the currency introduced by the Communist People’s Republic of China in 1949. Yuan is the name of a unit of the renminbi currency.
The currency pair USD/CNY is becoming increasingly popular with traders. A strong economic performance and talks of US-China trade deals are fueling a rise in interest in the Chinese economy. This is an exotic currency pair, and is, therefore, best suited to only the most experienced of investors.
China is the world’s largest exporter and remains the second-largest economy after the United States. This gives the USD/CNY pair a dominant trade position.
China’s national currency is the Chinese Yuan (CNY). Locally, it’s called the Renminbi, which means “the money of the people.” The Renminbi (RMB) is the official name for the currency, whereas the yuan is a unit of the currency.
The Chinese Yuan operates on a fixed exchange rate. This means China has tied its value to another currency. In this case, China pegs its currency to the U.S. dollar. However, since the dollar’s value fluctuates because it’s on a floating exchange rate – the People’s Bank of China must manually adjust the yuan’s value to track that of the dollar. The central bank achieves this by holding enough foreign exchange reserves to manage its currency’s value in the form of U.S. Treasuries. As one of the largest foreign holders of U.S. Treasuries, the value of the Chinese Yuan has become directly related to that of the US Dollar and the state of the US economy.
USD/CNY Significant Price Movements
China has been trying to make the Yuan (USD/CNY) into a global currency for a while now. From 1997 to 2005, China pegged its currency to the U.S. dollar.
In July 2005, the People’s Bank of China re-estimated the country’s currency, appreciating it by 2.1%. The introduction made a transition to a managed float system that was linked to a basket of currencies. At this point, one U.S. dollar valued at around CNY 8.1.
The Yuan saw steady appreciation going forward, getting to CNY 6.80 to CNY 6.90 per U.S. dollar by July 2008. A managed float introduced in July 2010 saw the Yuan appreciating further. In late 2013 and early 2014, one U.S. dollar valued at just over CNY 6.
Between 2011 and 2014, China allowed the Yuan (USD/CNY) to rise against the US dollar. It yielded to U.S. pressure, but it also wanted to keep its economy from overheating and creating inflation. As a result, in January 2014, the US Dollar to Chinese Yuan rate reached an 18-year high of 6.0487 yuan. Since then, the People’s Bank of China has allowed the yuan to weaken again in order to boost exports and strengthen China’s economic growth.
In August 2019, China’s central bank lowered the yuan to 7.0039 per dollar. That’s the weakest since April 21, 2008. China has been lowering the yuan to offset tariffs imposed by Trump’s trade war.
Which is the best broker to trade the USD/CNY pair?
There are many online brokers that support day trading of the USD/CNY pair. We are constantly evaluating new and existing brokers to recommend the most reliable ones. For more information, you can go to our page that reviews and compares the best Forex brokers to learn more about the different platforms where you can trade USD/CNY.
When I trade the USD/CNY pair will I own the actual currency?
No. CFDs allow you to speculate on rises and falls in the currency pair without having physical ownership. With CFDs, you only have to put in a fraction of the market value of the underlying asset when making a trade. Unlike investing, when you trade CFDs, you are not buying or trading the underlying asset. What you are buying/selling is a contract between yourself and the CFD provider.
How to trade the USD/CNY pair?
There are several ways to trade USD/CNY. Whether you opt for a USD/CNY scalping or breakout strategy when you trade could make all the difference to your intraday profits.
Unfortunately, very few Forex dealers currently offer the USD/CNY contract for trade. There may soon be a way for casual investors and traders to take advantage of this incredibly profitable trend as the RMB continues to gain strength over the USD/CNY in the months and years ahead.
The three analysis techniques are fundamental, sentiment and technical. We’d recommend having a good grasp on the fundamentals because this pair isn’t as actively traded as others and so isn’t as liquid.