The Japanese Yen exchange rate soars by 8.7%. How should Taiwanese people smartly exchange currency?

December 2025, the NT dollar to Japanese Yen reaches a level of 4.85. Starting from 4.46 at the beginning of the year, the Yen has appreciated nearly 9% in just one year. For Taiwanese wanting to exchange for Yen, this presents both an opportunity and a challenge. Is now a good time to exchange Yen? How can you do it to save the most money? We clarify everything with the latest data.

Why exchange Yen now?

The Yen’s appreciation is not just about exchange rate fluctuations but also involves the broader global economic landscape.

Bank of Japan leads rate hikes, market expectations adjusting

BOJ Governor Ueda Kazuo recently signaled a hawkish stance, with market rate hike expectations reaching 80%. It is expected that on December 19, the decision meeting will raise rates by 0.25 bps to 0.75% (a 30-year high). This signal is crucial—when Japan moves from ultra-low interest rates (0.5%) upward, the appeal of Yen as a financing currency reverses, and arbitrage trades start closing out, buying back Yen. The 10-year Japanese government bond yield has surged to 1.93% (17-year high), making Yen assets increasingly attractive for investors seeking stable returns.

Global risk aversion rekindled

The Yen is one of the three major safe-haven currencies globally (the other two are USD and Swiss Franc). Whenever geopolitical risks rise—be it in the Middle East or Taiwan Strait—funds flow into Yen. During last year’s Russia-Ukraine war, the Yen appreciated 8% in a week, serving as a perfect hedge against stock market declines. For Taiwanese investors, exchanging Yen is not just for shopping in Tokyo but also a layer of asset allocation protection.

NT dollar depreciation pressure and diversification needs

In the second half of the year, Taiwan’s foreign exchange demand increased by 25%, driven by two factors: tourism recovery (Japan being the most popular destination) and risk hedging. The Central Bank of Taiwan faces pressure from NT dollar depreciation, prompting many to diversify risk by converting some NT dollars into Yen or other strong currencies. The economic benefits of exchanging Yen are becoming evident.

Four methods to exchange Yen, with significant cost differences

Many think exchanging Yen is just going to the bank counter, but there are actually four options, each with different cost structures. Estimating with 50,000 NT dollars, losses range from 300 to 2,000 NT dollars—enough to buy 20 more cups of bubble tea.

Method 1: Traditional cash exchange at the counter

Bring NT dollars directly to a bank or airport counter to get Yen cash on the spot. It seems simple, but banks use the “cash selling rate” (1-2% worse than the spot rate), plus possible service fees, making it the most expensive.

Taiwan Bank’s cash selling rate is about 0.2060 NT dollars per Yen (i.e., 1 NT dollar = 4.85 Yen), but other banks like E.SUN, Taipei Fubon, and CTBC have slightly different rates, from 0.2058 to 0.2069. Some banks also charge 100-200 NT dollars per transaction. Exchanging 50,000 NT dollars results in a loss of about 1,500-2,000 NT dollars.

This method is suitable for urgent needs (like last-minute cash at the airport) or small amounts. Advantages: safe, full denominations, staff assistance; disadvantages: poor exchange rate, limited operating hours.

Method 2: Online currency exchange + foreign currency ATM withdrawal

This is the smartest option for beginners. First, use the bank app to convert NT dollars to Yen at the “spot sell rate” (about 1% discount), depositing into a foreign currency account. Then, use a chip-enabled debit card at a foreign currency ATM to withdraw cash, with a cross-bank fee of only 5 NT dollars. E.SUN’s foreign currency ATM has a daily limit of 150,000 NT dollars and operates 24/7.

Advantages: better exchange rate, 24-hour operation, minimal cross-bank fees. Disadvantages: limited ATM locations (fewer than 200 nationwide), may run out of cash at peak times (like airports), so plan ahead. Exchanging 50,000 NT dollars results in a loss of about 800-1,200 NT dollars.

Best for those without time to visit banks or as an emergency before traveling.

Method 3: Online currency exchange + airport pickup

Ideal for planned travelers. No need to open a foreign currency account—just fill in the amount and select a pickup branch (usually at the airport) on the bank’s website. After completing online exchange, bring ID to pick up.

Taiwan Bank’s “Easy Purchase” online exchange has no service fee (pay with Taiwan Pay, costing only about 10 NT dollars), with about 0.5% better rates. Taoyuan Airport has 14 Taiwan Bank branches, including 2 open 24 hours—very convenient. The downside: need to book 1-3 days in advance, and pickup times are limited by bank hours. Exchanging 50,000 NT dollars results in a loss of about 300-800 NT dollars, making it the lowest-cost method.

This is the best pre-travel planning option.

Method 4: Observe exchange rates and buy in installments

For a long-term view, you can buy in parts at lower rates, averaging your cost. For example, when NT dollar to Yen drops below 4.80, buy in stages, monitoring market trends. With the BOJ’s rate hike expectations rising, Yen may fluctuate 2-5% in the short term; staggered purchases can effectively reduce risk.

Suitable for experienced forex investors who are not in a rush to exchange all at once.

Exchange rate trends and investment considerations

Short-term vs. medium-term, Yen tells different stories

USD/JPY has fallen from a high of 160 at the start of the year to around 154.58. In the short term, arbitrage closing, BOJ rate hikes may cause 2-5% fluctuations, possibly returning to 155. But in the medium to long term, Yen is expected to find support below 150—this is due to the anticipated continuation of BOJ rate hikes and a global easing cycle.

For investors, this means that now is not the cheapest time to buy Yen, but it has entered a relatively advantageous zone. Buying in stages and avoiding chasing highs is smarter.

Next steps for Yen asset allocation

After exchanging Yen, don’t let the money sit idle with zero interest. Here are four common options:

1. Yen fixed deposit: Most stable, open online with E.SUN/Taiwan Bank foreign currency accounts, starting from 10,000 Yen, with annual interest rates of 1.5-1.8%. Suitable for conservative investors.

2. Yen insurance policies: Medium-term holdings, such as Cathay or Fubon savings insurance products, with guaranteed interest rates of 2-3%, ideal for locking in returns.

3. Yen ETFs (e.g., 00675U, 00703): Growth-oriented options, like Yuanta 00675U tracking Yen index, can be bought as fractional shares via broker apps, with a management fee of 0.4% annually, suitable for dollar-cost averaging.

4. Forex swing trading: Directly trade USD/JPY, EUR/JPY, etc., to capture short-term exchange rate movements. Offers two-way trading, 24/7 access, low fees—ideal for traders with risk management skills.

Quick FAQs

Q: What’s the difference between cash exchange rate and spot rate?
Cash rate is the bank’s quote for physical bills/coins, convenient for immediate exchange, but 1-2% worse than the spot rate plus fees. Spot rate is the foreign exchange market’s T+2 settlement price, closer to international market value, but requires waiting. In short: cash rate for urgent needs, spot for planning.

Q: How much Yen can I get with 10,000 NT dollars?
Using Taiwan Bank’s cash selling rate of 4.85, 10,000 NT dollars ≈ 48,500 Yen. Using the spot rate of 4.87, ≈ 48,700 Yen—about 200 Yen difference (roughly NT$40). Exact amounts depend on daily bank rates.

Q: What do I need to bring for counter exchange?
Taiwanese: ID card + passport; foreigners: passport + residence permit. For online booking, also bring transaction notice. Under 20 needs parental consent; large amounts (>100,000 NT dollars) may require source of funds declaration.

Q: Are there limits for foreign currency ATMs?
Post-2025 regulations, limits vary by bank. CTBC: equivalent of 120,000 NT dollars/day; Taishin: 150,000 NT dollars/day; E.SUN: 150,000 NT dollars/day (including card charges). It’s recommended to split withdrawals or use your own bank card to avoid cross-bank fees. Peak times may run out of cash, so plan ahead.

The complete guide to exchanging Yen

In summary, Yen has transcended its role as just “pocket money for travel” and has become an asset with hedging and investment value. Against the backdrop of BOJ rate hikes and ongoing geopolitical risks, the economic significance of exchanging Yen is increasingly clear.

Two key principles: stagger your purchases + don’t leave the money idle after exchange.

Beginners are advised to start with “Taiwan Bank online exchange + airport pickup” or “foreign currency ATM withdrawal,” which save time and costs. After exchanging, according to your risk preference, invest in Yen fixed deposits (conservative), Yen ETFs (balanced), or forex swing trading (advanced), to keep your funds active.

This way, you not only enjoy more cost-effective travel but also add a layer of protection amid market volatility. The hedging and investment potential of Yen are waiting for smart investors to seize.