How to get the most savings when exchanging Japanese Yen? Timing the exchange rate is the key to success.

In December 2025, the exchange rate of the New Taiwan Dollar (NTD) against the Japanese Yen (JPY) reached 4.85. This level is noteworthy for both travelers abroad and foreign currency investors. But the key question is: Is it the right time to exchange for Yen now? Is it suitable to buy US Dollars? The answer might be more complicated than you think.

Yen vs. USD, who should you choose now?

Let’s look at the data. Since the beginning of the year, the NTD has appreciated about 8.7% against the Yen (from 4.46 at the start of the year to 4.85 now), while the US Dollar has also shown significant movement. The Bank of Japan’s rate hike expectations are heating up (the December meeting is likely to raise rates to 0.75%, a 30-year high), which supports the Yen exchange rate; however, the US has entered a rate-cut cycle, putting the USD under relative pressure.

The current decision logic is simple:

If you are focusing on short-term hedging, the Yen, as one of the three major safe-haven currencies, tends to strengthen during global risk aversion. But if you are considering medium to long-term asset allocation, the liquidity and yield of the USD (currently with a USD-JPY interest rate differential of about 4.0%) remain attractive.

A pragmatic approach is: Exchange in batches and hold both currencies simultaneously. Convert some Yen to meet near-term needs, then opportunistically buy USD in moderation. Avoid going all-in on a single currency.

Is the Yen at a good entry point now?

The Yen exchange rate is currently within a reasonable range. USD/JPY is around 154.58; in the short term, it may test 155, but medium to long-term forecasts are below 150. For Taiwanese investors, amid the pressure of TWD depreciation, batching Yen exchanges is an effective hedge against Taiwan stock market volatility.

But don’t convert everything at once; closing arbitrage trades could trigger short-term fluctuations of 2-5%. It’s recommended to enter gradually weekly or monthly to average out the exchange rate costs.

Four ways to exchange Yen, with vastly different costs

Many think they can only queue at banks, but Taiwan offers four different channels, with significant differences in fees and exchange rates.

1. Bank counter cash exchange: The most traditional, highest cost

Bring TWD directly to a bank or airport counter to buy Yen cash. This uses the “cash selling rate,” which is 1-2% worse than the spot rate, plus handling fees. Just the spread can result in a loss of NT$1,500-2,000 (based on NT$50,000).

Taiwan Bank’s December 2025 rate example: cash selling rate of 0.2060 TWD/Yen; E.SUN Bank charges an additional NT$100 per transaction. Unless you need emergency cash at the airport, this is not recommended.

2. Online currency exchange to foreign currency account: Flexible but with conditions

Log into your bank app, use the spot sell rate to convert TWD to Yen and deposit into a foreign currency account. The rate is about 1% better than counter exchange. For cash, you can go to the counter or withdraw via foreign currency ATM, but withdrawal incurs exchange fees.

Suitable for frequent currency traders, those wanting to buy in batches, or considering Yen fixed deposits (annual interest rate 1.5-1.8%). Cost is about NT$500-1,000 (for NT$50,000 exchange).

3. Online currency exchange with immediate cash pickup: Reservation required, best rates

No need for a foreign currency account. Fill in the currency amount and pickup branch online, then bring ID and notification to the counter. Taiwan Bank’s “Easy Purchase” offers this service, with NT$10 handling fee via Taiwan Pay, and a 0.5% better rate.

Taoyuan Airport has 14 Taiwan Bank outlets supporting pickup (2 open 24 hours), making it the smartest pre-departure reservation method. Cost is about NT$300-800.

4. Foreign currency ATMs: Most convenient, 24/7 access

Use a chip-enabled debit card at foreign currency ATMs to withdraw Yen cash. Open 24 hours, interbank withdrawals cost only NT$5. The E.SUN Bank foreign currency ATM has a daily withdrawal limit of NT$150,000 equivalent, with no exchange fee.

The downside is there are only about 200 such ATMs nationwide. During peak travel seasons (like at airports), cash may run out. Denominations are fixed at 1,000/5,000/10,000 Yen. Cost is about NT$800-1,200.

Which method should you choose? Depends on your situation

After exchanging Yen, what’s next? Don’t let it sit idle

Once you have Yen, leaving it idle means giving up potential returns. Consider four options:

Yen fixed deposit: Deposit into a foreign currency account with a minimum of 10,000 Yen, annual interest 1.5-1.8%, very low risk.

Yen insurance policies: Cathay, Fubon Life offer dollar or Yen-denominated savings insurance with guaranteed interest rates of 2-3%, suitable for medium-term holding.

Yen ETFs: Yuanta 00675U or other Yen index-tracking funds, with 0.4% annual management fee, can be bought as fractional shares via broker apps, suitable for dollar-cost averaging.

Forex trading: Trade USD/JPY or EUR/JPY on forex platforms, with both long and short options, 24/7 trading, suitable for investors confident in currency fluctuations.

Common questions about currency exchange

Q. How much Yen can I get with NT$10,000?
Using Taiwan Bank’s cash selling rate of 4.85, NT$10,000 yields 48,500 Yen. Using spot rate 4.87, about 48,700 Yen. Difference roughly 200 Yen.

Q. What’s the difference between cash rate and spot rate?
Cash rate is the bank’s quote for physical banknotes, worse than spot but immediate; spot rate is the electronic market price, more favorable but settled T+2.

Q. What do I need to bring to the bank counter?
Taiwanese need ID card + passport; foreigners need passport + residence permit. Under 20 requires a guardian. Large exchanges over NT$100,000 may require source of funds declaration.

Q. What’s the daily withdrawal limit at foreign currency ATMs?
Varies by bank. CTBC and Taishin have limits around NT$120,000-150,000; E.SUN’s limit is NT$50,000 per transaction, NT$150,000 per day. It’s advisable to split withdrawals to avoid exceeding limits.

Summary: Exchange now, but do it wisely

Yen has evolved from a travel “pocket money” to an asset with hedging and investment value. With the NT dollar under depreciation pressure and Yen rate hikes imminent, batching exchanges is the safest strategy.

Choose “online exchange + airport pickup” or “foreign currency ATM” to minimize costs; after exchange, consider fixed deposits or ETFs to let idle funds grow. If you want to catch currency fluctuations, forex trading platforms are also an option.

The key is to avoid getting trapped by unfavorable counter rates, don’t convert everything at once, and don’t just sit on your gains. With timing and risk diversification, Yen can become a powerful tool to protect your assets.