What is hot in Japanese Yen investment? Revealing the costs of 4 major currency exchange channels | Must-read during the NT dollar depreciation era

Opening: Yen Exchange Rate Rises, Demand for Currency Exchange Surges

As of December 10, 2025, the NT$ against the Japanese Yen reached 4.85, appreciating by 8.7% since the beginning of the year. Market data shows that in the second half of the year, Taiwan’s currency exchange demand increased by 25%, with the Yen accounting for the largest share. Behind this trend are not only the recovery of tourism but also the deeper logic of capital hedging—when the NT$ faces depreciation pressure, the Yen becomes a smart investor’s hedging tool.

In comparison, although the Korean Won exchange rate also fluctuates, the Yen still holds advantages in risk hedging and long-term appreciation potential.

The Dual Identity of the Yen: Travel Currency × Hedging Asset

Why does the Yen dominate when exchanging foreign currencies? It’s not just because of Japan’s tourism boom, but also due to the Yen’s special status in the financial markets.

Practicality for Travel: Tokyo, Osaka, Hokkaido—Japan relies heavily on cash transactions (credit card penetration is only 60%). Purchasing agents, online shopping in Japan, studying abroad, working holidays—all require direct Yen settlement.

Hedging Attribute: The Yen is one of the world’s three major safe-haven currencies (along with USD and Swiss Franc), closely related to Japan’s stable economy. When the Russia-Ukraine conflict erupted in 2022, the Yen appreciated 8% in a single week, successfully offsetting stock market declines. For Taiwanese investors, exchanging Yen is equivalent to insuring their assets.

Arbitrage Mechanism: The Bank of Japan maintains ultra-low interest rates (0.5%), making the Yen a “funding currency.” Investors borrow Yen at low interest to buy higher-yielding USD (USD-JPY interest rate differential of 4.0%), then close the position when risks rise—this is a classic arbitrage game in financial markets.

Four Currency Exchange Methods Fully Explained | Cost vs. Convenience Trade-offs

Many think exchanging Yen only involves counter service, but the exchange rate spread alone can eat up several cups of bubble tea. We’ve collected the latest rates as of December 2025 and analyze the real costs of each method.

Option 1: Bank Counter Exchange | Traditional but Expensive

Carrying NT$ cash to a bank or airport counter to exchange Yen is straightforward but involves “cash selling rate” (1-2% worse than spot rate) plus handling fees, making it the most costly.

For example, Taiwan Bank’s cash selling rate is about 0.2060 NT$/Yen, meaning NT$1 exchanges for 4.85 Yen. E.SUN Bank charges an extra NT$100 per transaction, Cathay United Bank NT$200. Exchanging NT$50,000 results in a loss of about NT$1,500-2,000.

Advantages: Safe, reliable, denominations available (1,000, 5,000, 10,000 Yen options), staff assistance. Disadvantages: Exchange rate spread, limited business hours (9:00-15:30 on weekdays), possible additional handling fees. Suitable for: Travelers unfamiliar with online operations or urgent needs at the airport.

Option 2: Online Currency Exchange + In-Person Pickup | For Advanced Users

Using bank app or online banking, convert NT$ to Yen and deposit into a foreign currency account, using “spot sell rate” (about 1% better than cash rate). When cash is needed, pick up at counter or foreign currency ATM, but additional exchange spread and handling fees apply (from NT$100).

E.SUN Bank’s app allows exchange and cash pickup with fees based on the rate difference. Suitable for monitoring exchange rates, entering positions when NT$ to Yen drops below 4.80, averaging costs. Exchanging NT$50,000 may result in a loss of NT$500-1,000.

Advantages: 24-hour operation, ability to buy in installments, favorable rates. Disadvantages: Need to open a foreign currency account, withdrawal fees (NT$5-100 cross-bank). Suitable for: Experienced forex traders, frequent foreign currency account users, those considering Yen fixed deposits (annual interest 1.5-1.8%).

Option 3: Online Forward Exchange to Airport | Best Before Departure

No need for a foreign currency account, just fill in amount, branch, and date on the bank’s website, then bring ID and transaction notice to pick up in person. Taiwan Bank’s “Easy Purchase” online forward exchange is fee-free (pay NT$10 via TaiwanPay), with a 0.5% rate advantage.

Taoyuan Airport has 14 Taiwan Bank branches, 2 of which operate 24 hours—ideal for pickup before flights. Exchanging NT$50,000 may result in a loss of NT$300-800.

Advantages: Favorable rates, often no fees, can specify airport branch. Disadvantages: Need to book 1-3 days in advance, pickup during bank hours, branch cannot be changed on short notice. Suitable for: Planned travelers who want to withdraw at the airport.

Option 4: Foreign Currency ATM | The Most Flexible Choice

Using chip-enabled bank cards at foreign currency ATMs to withdraw Yen, supporting 24/7 operation, with only NT$5 cross-bank fee deducted from NT$ account. About 200 units nationwide, mainly in urban areas.

SinoPac Bank’s foreign currency ATMs allow NT$ account withdrawals without exchange fees, with a daily limit of NT$150,000. Note: Japan ATM withdrawal services will be adjusted by the end of 2025, requiring international cards (Mastercard/Cirrus). During peak times (airports, New Year holidays), cash may run out—plan ahead. Exchanging NT$50,000 may result in a loss of NT$800-1,200.

Advantages: Instant withdrawal, maximum flexibility, lowest cross-bank fees. Disadvantages: Limited locations, fixed denominations (1,000/5,000/10,000 Yen), possible shortages during peak hours. Suitable for: Those with no time for counter service or needing urgent cash.

Cost Comparison of 4 Major Methods | Clear Table

Current Exchange Rate Analysis: Is Now a Good Time to Exchange?

Short-term fluctuations vs. medium-long-term trends

As of December 2025, USD/JPY is at 154.58, with the Yen appreciating 8.7% from the start of the year. But the real story lies in the divergence of monetary policies between the US and Japan.

Bank of Japan Governor Ueda Kazuo has recently made hawkish comments, with market expectations of an 80% chance of interest rate hikes. The December 19 meeting is expected to raise rates by 0.25 bps to 0.75% (a 30-year high), with Japanese government bond yields reaching a 17-year high of 1.93%.

Meanwhile, the US is entering a rate-cut cycle, narrowing the interest differential and supporting the Yen. USD/JPY has fallen from a high of 160 at the start of the year to 154.58, with short-term rebounds to 155 possible, but medium to long-term forecasts suggest it will fall below 150.

Implication for investors: The Yen’s safe-haven attribute is strong, but short-term arbitrage closing may cause 2-5% volatility. It’s advisable to exchange in installments and avoid putting all funds in at once.

After Exchanging Yen: 4 Ways to Make Money Work for You

Exchanging Yen shouldn’t be a passive, interest-free activity. Here are four investment options suitable for small beginners to gradually upgrade.

1. Yen Fixed Deposit (Conservative)
Open foreign currency accounts at E.SUN Bank or Taiwan Bank, deposit online. Minimum NT$10,000, annual interest rate 1.5-1.8%.

2. Yen Insurance Policy (Mid-term)
Savings insurance from Cathay or Fubon Life, guaranteed interest rate 2-3%, suitable for medium-term locked-in returns.

3. Yen ETFs (Growth)
Yuanta 00675U, 0070 tracking Yen indices, can buy fractional shares via broker apps, suitable for regular investment. Management fee 0.4% annually.

4. Forex Swing Trading (Advanced)
Trade USD/JPY, EUR/JPY directly, using 24-hour markets to capture exchange rate fluctuations. Both long and short positions, low-cost operations.

Quick FAQs

Q: What’s the difference between cash exchange rate and spot rate?
Cash rate is the bank’s buy/sell rate for physical cash, usually 1-2% worse than spot rate. Spot rate is the T+2 delivery price in the forex market, closer to international market, lower cost but requires settlement wait.

Q: What documents are needed to exchange foreign currency?
Counter service requires ID + passport. Under 20 needs parent’s consent and ID. Large amounts (over NT$100,000) may require source declaration. Online booking needs transaction notice.

Q: Are there limits on ATM withdrawals in foreign currency?
Different banks have different rules: CTBC Bank’s debit card limit is NT$120,000/day; Taishin Bank NT$150,000; E.SUN Bank NT$150,000 (including debit). Other banks’ limits should be checked with issuing bank. After 2025, many banks lowered third-category account limits to NT$100,000/day.

Core Advice | Position Before the Depreciation Wave

The Yen has evolved from “travel pocket money” to “hedging asset.” Driven by NT$ depreciation pressure and Yen appreciation expectations, now is the time to gradually build positions.

Beginner Path:

1. Try “Taiwan Bank online forward exchange + airport pickup” or “foreign currency ATM,” with controlled costs.
2. After exchanging Yen, move funds into fixed deposits or ETFs for continuous growth.
3. If interested, small-scale forex swing trading to experience long/short strategies.

Remember: staggered exchange + not leaving funds idle is the key to reducing costs and amplifying gains. This is not only about saving on travel expenses but also about adding a protective shield for your assets amid global market turbulence.