Yen exchange rate soars by 8.7%! Four major tips to help you save the most

End-of-2025 JPY Market Boom

The Taiwan dollar against the Japanese yen has surged to 4.85, up from 4.46 at the beginning of the year, an appreciation of 8.7%. This is no coincidence—the Bank of Japan is on the verge of raising interest rates, with market expectations of a hike to 0.75% on December 19 (a 30-year high). Coupled with global risk-averse capital inflows, the yen has become the hottest foreign currency at year-end.

Meanwhile, the Hong Kong dollar against the yen is also fluctuating as it seeks balance, and Taiwanese investors’ interest in foreign currency allocations is surging. Industry observations show a 25% growth in foreign exchange demand in the second half of the year, with tourism recovery and risk hedging running in parallel.

But here’s a key issue: Exchanging 100,000 TWD to yen through the wrong channel could result in a loss of NT$1,500.

A Quick Guide: Which of Four Currency Exchange Methods Is the Most Cost-Effective?

Don’t think you can only go to banks for cash exchange. The cost differences between methods are huge.

What’s the most cost-effective? For budgets of NT$50,000–200,000, “Online settlement + airport withdrawal” is the most economical, with the lowest costs and best rates.

Real-time Bank Rate Comparison (December 10, 2025)

Want to know which bank offers the best rate? This comparison speaks for itself:

Insight: Taipei Fubon’s cash sell rate is the best (0.2069), but it charges NT$100 handling fee; E.SUN has the lowest fee but the worst rate (0.2058). Overall, Taiwan Bank, Hua Nan, and Mega Bank offer the best combination.

Deep Dive into Four Currency Exchange Methods

Method 1: Over-the-counter cash exchange — The most traditional but most expensive

Bring cash TWD directly to the bank or airport counter to get yen cash on the spot. The process is simple, but the “cash sell rate” is 1-2% worse than the spot rate, and this difference ends up in the bank’s pocket.

How much NT$ for NT$10,000? For example, Taiwan Bank’s cash sell rate of 0.2060 (1 TWD = 4.85 yen) means NT$10,000 exchanges for about 48,500 yen.

✅ Advantages: Safe, reliable, denominations available (1,000, 5,000, 10,000 yen)
❌ Disadvantages: Worst rate, extra handling fee, limited to business hours (Weekdays 9:00-15:30)

Best for: Those unfamiliar with online operations or needing small emergency amounts.

Method 2: Online currency exchange — The favorite of intermediate players

Use bank app or online banking to convert NT$ to yen at the “spot sell rate,” saving about 1%. If you want cash, withdraw at the counter or ATM, incurring a withdrawal fee (NT$100+).

Advantages: Can buy in installments to average costs, monitor exchange rates anytime, buy at lows (e.g., when NT$ to yen <4.80).

✅ Pros: 24/7 operation, favorable rates, flexible allocation
❌ Cons: Need a foreign currency account, withdrawal fees apply

Best for: Experienced forex traders, those planning yen fixed deposits (current annual rate 1.5-1.8%) or ETF investments.

Method 3: Online currency settlement — Must-have for airport travelers

No need for a foreign currency account. Fill in amount, branch, and date on the bank’s website, then complete transfer. Bring ID + transaction notice to the counter to pick up cash.

Who does this? Taiwan Bank’s “Easy Purchase” online settlement with no handling fee (pay NT$10 via TaiwanPay), offering a 0.5% rate advantage, with the option to pick up at Taoyuan Airport branch (most locations, 24/7 operation at two branches).

✅ Advantages: Better rates, often no handling fee, airport pickup, online reservation
❌ Disadvantages: Need to book 1-3 days in advance, pickup during bank hours, branch cannot be changed

Best for: Well-planned travelers who want quick airport cash before departure.

Method 4: Foreign currency ATM — 24/7 emergency station

Use a chip-enabled bank card at foreign currency ATMs to withdraw yen cash. E.SUN Bank supports direct deduction from TWD account, with a daily limit of NT$150,000, and no exchange fee. Cross-bank transactions cost NT$5.

Note: Only about 200 locations nationwide, limited currencies and denominations (fixed at 1,000, 5,000, 10,000 yen). During peak times, cash may run out.

✅ Advantages: Instant withdrawal, high flexibility, open year-round
❌ Disadvantages: Few locations, fixed denominations, often out of stock during busy hours

Best for: Those who don’t have time to visit banks or need urgent cash.

Withdrawal limit quick reference:

When is the best time to exchange? Staged entry is the key

Is now a good time to exchange? Yes, but don’t exchange all at once.

The yen is currently on an upward trend, but volatility remains high. The US is entering a rate cut cycle, and the Bank of Japan is about to raise rates. USD/JPY has fallen from a high of 160 at the start of the year to 154.58, with short-term fluctuations possibly returning to 155, but medium to long-term forecasts suggest below 150.

Investor takeaway: The yen combines risk hedging and yield potential, but arbitrage closing carries a 2-5% volatility risk. It’s recommended to buy in three stages:

• First batch: Exchange now (to establish a base)
• Second batch: Wait for below 4.80 and add more
• Third batch: Keep some flexibility for sudden needs

Investment extensions after yen exchange

Don’t let your yen sit idle without interest—here are four ways to grow your money:

1. Yen fixed deposit — Conservative
Open a foreign currency account with E.SUN or Taiwan Bank, starting from 10,000 yen, with annual interest of 1.5-1.8%. Suitable for conservative investors.

2. Yen insurance policy — Medium-term allocation
Cathay or Fubon life’s yen savings insurance, with guaranteed interest rates of 2-3%, locking in long-term gains.

3. Yen ETFs — Growth-oriented
Yuanta 00675U tracks the yen index, available for fractional investing via broker apps, suitable for those bullish on yen appreciation.

4. Forex swing trading — Advanced players
Trade USD/JPY or EUR/JPY directly on platforms like Mitrade, with advantages of long/short positions, 24-hour trading, and low spreads with zero commissions.

Quick FAQs

Q: What’s the difference between cash rate and spot rate?
Cash rate applies to physical cash exchange, with banks delivering on the spot but at a 1-2% premium. Spot rate is used for T+2 electronic settlement, offering better rates but requiring wait. In short: cash is convenient but costly; spot is cheaper but takes time.

Q: How much yen for NT$10,000?
Using Taiwan Bank’s cash sell rate of 0.2060, NT$10,000 ≈ 48,500 yen; with spot rate 0.2065, about 48,400 yen—a negligible difference.

Q: What to bring for over-the-counter exchange?
Taiwanese: ID + passport; foreigners: passport + residence permit. If pre-booked online, also bring transaction notice. Large amounts (>NT$100,000) may require source of funds declaration.

Q: Is there a withdrawal limit at foreign currency ATMs?
Yes. Post-2025 regulations, most banks limit daily withdrawal to NT$100,000–150,000. It’s advisable to split withdrawals or use your own bank card (to save NT$5 cross-bank fee).

Summary

The yen has surpassed the “travel pocket money” role, becoming an asset allocation option with both hedging and appreciation potential. Whether for next year’s Japan trip or hedging Taiwan stocks, following the “staged exchange + immediate allocation” principles can minimize costs and maximize returns.

Beginners are advised to start with “Taiwan Bank online settlement + airport pickup” or “foreign currency ATM,” then transition into fixed deposits, ETFs, or swing trading based on needs. This way, you not only play more cost-effectively but also add a layer of protection during global turbulence.

Although HKD/JPY still fluctuates, the overall trend remains worth watching as a multi-currency reference indicator.