CNY vs. CNH: Why One Yuan Has Two Dollar Quotes

A California importer watches an offshore yuan quote late in the US afternoon, but the supplier prices the invoice using an onshore reference. Both prices are described as yuan per dollar. They are not interchangeable prices for the same settlement route.

Start with invoice settlement instructions and offshore hedge confirmation. Look for onshore CNY compared with offshore CNH at the same timestamp. The calculation you want is the residual on a yuan invoice hedged offshore. A common reason for a discrepancy is different fixing times and the basis between markets. The first worked figures below are illustrative. The historical section identifies the actual observations used and lets you change one assumption at a time.

Measure the offshore premium with consistent units

Suppose the onshore rate is 7.1846 and the offshore rate is 7.2138 yuan per dollar at comparable times. The offshore quote exceeds the onshore by 0.0292 yuan per dollar, about 0.406% of the onshore number. USD buys more offshore yuan in this example. Describing the difference as a stronger offshore yuan would reverse the sign. Conversely, a negative difference means fewer offshore yuan per dollar.

For a fixed 720,000 yuan invoice, dividing by each hypothetical quote gives two different dollar budgets. The discrepancy is a basis exposure only if the invoice and hedge settle against different references. You cannot assume the company can freely move the full onshore amount offshore, transact both sides and capture the gap. Documentation, settlement eligibility, available credit and charges affect any actual conversion.

Separate the fixing from a tradable price

A central parity announcement, a domestic spot quote and an offshore spot quote describe different objects. If a chart vendor pauses one series outside domestic hours while the offshore market continues to move, the apparent spread partly reflects staleness. Compare time zones down to the date boundary. An afternoon in New York can already belong to the next calendar day in part of Asia.

Ask the supplier to name the currency, receiving account, settlement date and conversion source. Ask the hedging provider to name its fixing or delivery terms. The historical market cases below use the Fed’s published Chinese yuan observations as a reference for the domestic currency. They do not pretend that this single series measures the historical offshore spread; the offshore leg in each example is explicitly assumed.

When offshore settlement solves only half the problem

A New Jersey importer can know its invoice amount in China well before the final benchmark is available. It may obtain an offshore hedge through an eligible intermediary. A document saying renminbi on both sides is insufficient. Check onshore versus offshore, cash versus delivery, the settlement bank, the fixing time and the currency of the debit on the counterparty statement. Each describes a different dependency.

In a basis worksheet, value the unhedged invoice at the onshore rate, the matched part at the offshore fixing and any unmatched balance at its purchase rate. To isolate the basis, hold the notional and value date constant and make only the final onshore and offshore rates differ. Then change the settlement date alone. A shortfall that looked entirely like a location problem may actually include a funding day or holiday mismatch.

How to check the figures yourself

Quote both markets as yuan per dollar before subtracting them. Inverting just one rate creates a meaningless spread. A screen quoting USD per offshore yuan needs a reciprocal; its bid and ask also swap sides. Use simultaneous prices to distinguish a location difference from a change across time.

If an importer’s invoice is fixed onshore while the hedge settles offshore, measure each cash leg at its own benchmark. The two can move together without matching exactly. A correlation close to one tells you little about the size of the cash shortfall on a specific fixing date.

Historical cases and a reproducible dollar comparison

To see what changes the dollar decision, take one clearly defined exposure: CNY 288,600 component invoice. The historical column follows USD/CNY onshore reference, using daily Federal Reserve exchange-rate observations distributed through FRED as DEXCHUS. The exercise uses 96 complete or selected calendar months from 2017-01 through 2024-12. The fixed research window runs from January 2017 through December 2024. Rates are publicly observed. Retail fees, contract terms and decision rules in the examples are assumptions.

Translate the amount by dividing 288,600 by the observed onshore yuan per dollar. This column intentionally has no hedge. A separate offshore fixing would be required to measure the cash outcome of an actual offshore hedge or the divergence between markets.

The modeled output is measured in US dollars. Its sign and units are essential when you work backward from a chart. Write the initial reference, the final reference, their dates and the modeled result in separate columns. Calculate with unrounded inputs, then round for display. A dollar-cent display may conceal small changes in the reference, especially where the model floors an outcome at zero. This series can describe the US importer’s exposure to the onshore price even if offshore market data is missing. It cannot support claims about the historical size or direction of the offshore premium.

Across these months the exchange quote rose 48 times, fell 48 times and was unchanged 0 times. The median absolute endpoint change was 0.95%. The 25th and 75th percentiles of signed endpoint returns, using the sorted observation at the floor of the fractional rank on a zero-based scale, were -0.95% and 0.95%. These are descriptive sample figures. A frequency of rising quotes is neither a rate of profitable trades nor the chance of a favorable outcome on a future payment.

The largest rise | 2022-04

Start with the largest signed monthly rise in this sample. At the last observation of 2022-03, the quote was 6.33930. At 2022-04-29 it was 6.60800, a signed change of 4.24%. Applying the exposure rule to the earlier price gives 45,525.53 US dollars. Applying it to the later price gives 43,674.33 US dollars. The resulting difference is -1,851.20 US dollars. The quote and the modeled amount need not move in the same direction. Read the numerator and denominator of the actual contract before interpreting a rising candle as a higher bill.

For a plausible contemporaneous alternative, use the first observation of the new month, 6.36250 on 2022-04-01, as the budget anchor. The modeled change to the same ending date becomes -1,685.19 US dollars. You have altered only the starting timestamp. That small adjustment matters when the prior month ended before a weekend or holiday. A report that chooses the better anchor afterward mixes performance evaluation with hindsight. Use the timestamp of the actual invoice, forecast or mandate if one exists.

Measure a mismatch between settlement locations

For CNY 82,000 owed onshore use 6.60800 as the onshore reference. Impose a fictional offshore fixing at 6.62000, a signed difference of 0.01200 yuan per dollar. To isolate the location difference assume the original offshore hedge rate equaled 6.33930 and the hedge offsets a fixed yuan payable. Its simplified dollar receipt is USD -548.48, with a negative receipt representing a payment.

The company buys onshore yuan for USD 12,409.20 and subtracts that signed hedge receipt. The combined debit is USD 12,957.68 against an initial budget of USD 12,935.18. The difference of USD 22.49 survives even with equal face amounts because the final denominators differ. The onshore reference is historical. The offshore fixing and hedge are purely illustrative and must not be entered into an archive as a measured CNY/CNH spread.

The largest decline | 2018-01

The steepest fall among the remaining months went from 6.50630 to 6.28410. The cross rate expressed in reverse would instead move from 0.15370 to 0.15913. Its signed percentage change is 3.54%, whereas the original quote changed by -3.42%. Reversing a percentage sign is only an approximation. Arithmetic returns in reciprocal currencies have different denominators. Use full-precision quotes when translating a dollar budget in either direction.

In the working example the unchanged exposure generated a modeled 45,925.43 US dollars at the end, against an original 44,357.01 US dollars. At the arithmetic midpoint of the two observed rates the modeled result would be 45,127.60 US dollars. By comparison the mean of the two modeled endpoint amounts is 45,141.22 US dollars. A linear conversion can make these coincide; a reciprocal or an option-like floor can separate them. This is a practical unit test for a budget spreadsheet built by averaging rates before conversion.

The quietest finish | 2021-08

A quiet monthly finish concealed a sequence of 22 observations. The first budget mark and last mark differed by only 0.01% in absolute quote terms. Between them, the lowest sampled exchange rate was 6.46040 on 2021-08-31 and the highest was 6.50120 on 2021-08-20. Their ordering is observable at the daily reference frequency. It says nothing about whether a stop or limit was touched first inside an individual trading day.

Including the original budget mark, the lowest and highest modeled amounts were 44,391.80 US dollars and 44,672.16 US dollars. A payment falling due inside this interval would use the terms available on its own date. Picking the cheapest date after seeing the month grants an option the original decision maker may never have had. Ask whether the underlying agreement allowed early settlement, whether the counterparty would accept it, and what financing or fees would accompany changing the date. The end-to-end change alone leaves out all three questions.

The widest daily range | 2022-09

For the widest remaining sample range, compare the recorded low of 6.89850 with the high of 7.19900. That spread is 4.36% of the previous month-end reference. If the exposure were valued separately at those two observations, the modeled amounts would be 41,835.18 US dollars and 40,088.90 US dollars. A full intraday high-low range could be larger than this sampled range. Treat these as independent reference valuations, not executable bid and offer quotes sitting on a dealer screen at the same instant.

Now place an administrative review on the middle observation, 2022-09-16. At 6.97990 the modeled amount was 41,347.30 US dollars. The remaining change to the final observation was -776.55 US dollars. This separates currency exposure before and after the person responsible could act. It is especially useful when a headline about the full month sounds alarming but the invoice was approved or the policy decision released much later. Use an actual approval timestamp for a real case.

The busiest path | 2022-11

This month has the greatest remaining sum of absolute observation-to-observation log changes: 10.66 percentage points. Its net endpoint change in ordinary percentage terms was -2.97%. Offsetting moves can make the first number large while leaving the second small. Absolute log movement is a path statistic. It includes both directions and must never be booked as the return someone earned by holding the exposure. Collecting every move would require knowing each reversal and being able to execute it after costs.

The annualized sample standard deviation calculated from the 20 log changes was 10.34%, using 252 observations per trading year. The mean level across this month’s daily exchange marks was 7.18118, whereas its median was 7.16410. Valuing the exposure at those two central rates gives 40,188.38 US dollars and 40,284.19 US dollars. The mean answers a question about evenly weighted observations and the median is the middle observation or average middle pair. Neither is necessarily the benchmark named in a specific agreement.

A month near the middle | 2017-01

Extreme outcomes attract attention. This case was chosen for being close to the median absolute monthly move among the remaining candidates, with an absolute change of 0.95%. Its 19 daily marks give an average modeled value of 41,883.71 US dollars. Valuing the same exposure only at the last mark produces 41,967.19 US dollars. The final observation therefore differs from the typical daily valuation measured by that average by a signed 83.49 US dollars. The difference can go either way; the average has no privileged status for a one-date settlement.

Suppose a report allowed one person to choose a monthly average and another to use the last observation. They could disagree by that amount while applying identical formulas and the same published data. Settle the disagreement by identifying the decision the figure supports. A month of evenly spread expenses calls for transaction weights or a stated approximation. A single invoice calls for its conversion date. A policy announcement needs a timed quote. The right measurement rule follows from the economic event and should be fixed before examining the answer.

Measure a mismatch between settlement locations

For CNY 730,000 owed onshore use 6.87680 as the onshore reference. Impose a fictional offshore fixing at 6.84980, a signed difference of -0.02700 yuan per dollar. To isolate the location difference assume the original offshore hedge rate equaled 6.94300 and the hedge offsets a fixed yuan payable. Its simplified dollar receipt is USD 1,430.59, with a negative receipt representing a payment.

The company buys onshore yuan for USD 106,154.03 and subtracts that signed hedge receipt. The combined debit is USD 104,723.44 against an initial budget of USD 105,141.87. The difference of USD -418.43 survives even with equal face amounts because the final denominators differ. The onshore reference is historical. The offshore fixing and hedge are purely illustrative and must not be entered into an archive as a measured CNY/CNH spread.

A sharp single step | 2019-08

The largest remaining single-step move was from 6.93870 on 2019-08-02 to 7.04810 on 2019-08-05. In ordinary percentage terms that is 1.58%. Against the exposure rule, this step changes the modeled amount by -645.60 US dollars. Because the observations can be separated by nonbusiness days, describe this as an observation-to-observation change. The file cannot reveal which hour accounted for it or whether liquidity was available at either published level.

To check a claim about that step, identify the calendar of releases and local holidays for both currencies, then match each event with its precise published time. Look for an independent price series that actually traded in the proposed interval. A gap between daily reference marks invites a hypothesis; following the sequence of executable quotes is how you could test it. Changing an amount solely because of the two marks is an accounting exercise. Attributing the difference to a particular trader, institution or economic release needs additional evidence.

A split-date budget | 2018-06

Take the average modeled valuation on the first five available dates, 45,092.22 US dollars, and on the last five available dates, 43,792.39 US dollars. Their difference is -1,299.83 US dollars. This case has the largest remaining absolute gap by that definition. A plan fixed in advance to value half the exposure against each group would give a weighted amount of 44,442.30 US dollars if the exposure and its charges can be divided proportionately. The result is a comparison of timing policies. It does not reveal an optimal execution date.

A fixed charge can break that proportional assumption if two actual transactions each incur the full charge. An indivisible futures contract or option can prevent splitting the quantity at all. An announcement time cannot be averaged across ten dates. Before applying the exercise, identify the specific constraint: different fixing times and the basis between markets. Then identify which of the two windows an actual mandate would allow. Where the timing choice is unavailable, read the two amounts as a sensitivity range instead of an executable plan.

How much basis is material on a real invoice?

Use a hypothetical onshore fixing of 7.2240 and an offshore fixing of 7.2360 yuan per dollar. Their quoted gap is 0.0120, but dividing the invoice by each rate is the direct way to measure the impact on a dollar budget. On a CNY 72,240 invoice the onshore reference produces exactly $10,000. Subtract the offshore dollar equivalent from that amount. The difference is about $16.58, before any execution spread or mismatch in notional.

A spread in exchange-rate points is useful for charting. A controller needs the currency amount after the hedge has settled and the supplier has been paid. Keep the quote precision until after division, particularly where the spread is small. If the business already has matching onshore receipts, net only cash flows whose timing and settlement conditions actually match. Gross purchases can exaggerate the currency amount to hedge, while inaccessible balances can make an apparent natural hedge impossible to use.

How to identify a usable USD/CNH setup on a chart

Open a five-minute USD/CNH replay and hide everything to the right of your intended decision. This is a hypothetical short case, constructed to show how different fixing times and the basis between markets fits into an execution record. Use New York local time for the chart, retaining the actual offset for the date. For a restricted or offshore currency, this drawing describes a price sequence, not the availability of a US retail contract. An economic reference period, a release time and a bar timestamp belong in separate fields.

In the first diagram the reference high is 7.25140. The candle that trades above it reaches 7.25193 before price returns into the range. To describe that move as a sweep in ICT terminology, mark the existing level first. If the level only becomes obvious after the reversal, save the observation as a retrospective pattern. An increase in volume or a financial headline cannot reveal whose orders traded there.

The displaced leg reaches beyond 7.25009. Read bars five, six and seven as a sequence. A gap between the outer wicks brackets the interval from 7.25018 to 7.25050. It is a chart definition of an imbalance. Price could fill that interval, pass straight through it or never revisit it. Only the first return that satisfies a rule written in advance can provide a candidate entry for this particular exercise.

How to trade the idea on demo and define failure

For the rehearsal, a sell at 7.25035 follows a return into the marked interval. If the order fails to fill, record an unfilled setup and retain the original timestamp. Moving the order toward the next favorable candle after that candle forms changes the test. Keep the macro or account question separate: The independent document check concerns different fixing times and the basis between markets. A convincing answer about that issue cannot make a missed entry executable.

The protective exit is 7.25223, beyond the sweep, and the planned target is 7.24659. For this short idea the favorable direction in the pair is lower. A live position can experience partial fills, a spread jump or a gap past the stop. For this drawing only we assume all levels execute exactly as stated. The second chart displays one favorable sequence so that the accounting can be checked. It supplies no evidence about how often such a sequence occurs.

Set an expiry for the entry and cancel the study if the invalidation trades before entry or if the spread makes the gross plan infeasible. If a coarse chart touches stop and target within one bar, lower-frequency OHLC cannot settle the order of events. Use properly timestamped executable quotes if available. Otherwise keep a separate ambiguous sample, and state that rule before counting wins. For this rehearsal the underlying document remains the source for the residual on a yuan invoice hedged offshore.

Worked example in a US dollar account

Calculate the distance before calculating the money. The entry-to-stop distance is |7.25035 minus 7.25223| = 0.00188, or 18.8 pips. The target distance is |7.24659 minus 7.25035| = 0.00376, or 37.6 pips. Keeping absolute distances here avoids giving a short setup a negative risk amount. The sign of the actual result belongs on the fill record after closing.

At 13,000 base units, the distance to the stop represents 24.44 CNH and the distance to the target represents 48.88 CNH. Convert to a USD result separately at each assumed exit by dividing by 7.25223 or 7.24659 CNH per US dollar. The conversion is slightly different on the two outcomes. Gross reward divided by gross risk is USD 6.75 / USD 3.37 = 2.00. Written as risk:reward this is 1:2.00.

Assume a round-trip cost of USD 1.90 on either completed outcome. We use executable entry and exit prices, so a spread already inside those prices must not be charged again. The simplified net reward is USD 6.75 minus USD 1.90 = USD 4.85. Net planned loss is USD 3.37 plus USD 1.90 = USD 5.27. Net R:R is 1:0.92 because USD 4.85 / USD 5.27 = 0.92. Financing, slippage and tax are excluded from this short rehearsal.

Check the losing branch with the same care as the winning one. If the exit slips by one additional pip against you, the quote-currency impact on this size is 1.30 CNH before any conversion. A plan denominated in dollars should reserve for an adverse fill or skip a setup that cannot fit the intended budget. Keep the original quote and the executed price alongside the size and currency of the exposure.

To annotate the rehearsal, mark the existing swing first, then identify displacement and the interval between the outer candle wicks. For definitions and session context, see the school’s lessons on fair value gaps, order blocks, the London session, market structure shifts, and the Judas swing.

Sources and calculation notes

CME offshore renminbi contract FAQ. HKMA economic review of mainland China.

Historical series and original records. DEXCHUS observations and units. The calculations use observations available when checked on November 14, 2026. Subsequent revisions can change retrospective comparisons.

Frequently asked questions

To check an exchange quote from another angle, see inverse currency quotes, broker quote differences, forex chart reading, and the trading journal.