Yen value rebounds! The currency exchange map of the NT$ 4.85 era

In December, the yen reached new highs, with the Taiwan dollar against the yen surpassing 4.85. Looking globally, the Bank of Japan is on the verge of raising interest rates. The yen has evolved from a safe-haven currency into a yield-generating asset. Coupled with increased volatility in the Taiwan stock market, more and more people are seriously considering exchanging for yen. But did you know? Choosing the wrong method to exchange 50,000 TWD could cost you an extra 2,000 yuan.

Why is the yen worth paying attention to?

From an investment perspective, the yen is no longer just a “travel currency.” As one of the world’s three major safe-haven currencies, it ranks alongside the US dollar and Swiss franc, with funds automatically flowing in during market panic. During the week of the Russia-Ukraine conflict in 2022, the yen appreciated 8% in a week, buffering a 10% drop in the stock market—that’s the value of safe-haven status.

This is especially important for Taiwanese investors: under the pressure of TWD depreciation, moving some funds into yen is like adding an extra layer of protection outside the stock market.

Even more interesting is that the Bank of Japan is changing the game. Recent hawkish comments from Governor Ueda Kazuo have pushed market expectations of rate hikes to 80%, with a 0.25 bps increase expected at the December 19 meeting (a 30-year high). This means the yen deposit interest rate will rise, with annual rates climbing from 1.5% toward 1.8%. The 200 yen note may seem small, but long-term compound interest accumulation is also worth noting.

4 Practical Methods to Exchange for Yen

Have you noticed the big difference between bank and ATM exchange rates? This is not a coincidence but a fundamental difference between “cash” and “electronic” transactions.

First: In-branch cash exchange

Go directly to a bank or airport branch, exchange TWD cash for yen notes. This is the most traditional way and also the most expensive.

Why is it costly? Because banks use the “cash selling rate,” which is about 1-2% worse than the market spot rate. For example, Taiwan Bank’s cash selling rate on December 10 was 0.2060 (TWD/JPY). Exchanging 50,000 TWD yields about 242,500 yen, but the cost could result in a loss of 1,500-2,000 yuan. Some banks also charge an additional 100-200 yuan handling fee, making it less cost-effective.

Advantages: Safe, convenient, denominations available (1000, 5000, 10000 yen). Suitable for urgent airport needs or unfamiliar with online procedures.

Second: Online currency exchange + airport pickup

This is the “best solution” before traveling abroad. Fill in currency, amount, pickup branch, and date via bank app, complete the transfer, then bring ID and transaction notification to pick up in person. Taiwan Bank’s “Easy Purchase” online exchange has no handling fee (pay with Taiwan Pay, only 10 yuan), with about 0.5% better rates.

Cost drops from 1,500 yuan to 300-800 yuan. You can also reserve pickup at Taoyuan Airport branches—out of 14 Taiwan Bank locations, 2 operate 24 hours, so last-minute flights are no problem.

Ideal for planned travelers, especially if booking in advance during off-peak seasons for better rates.

Third: Online exchange + in-branch or ATM withdrawal

Use online banking or app to convert TWD into yen and deposit into a foreign currency account, using the “spot sell rate” (about 1% better than cash selling rate). If cash is needed, withdraw via foreign currency ATM or in-branch, but there will be a currency conversion fee starting around 100 yuan.

Advantages: Can observe exchange rate trends in stages, entering at low points (e.g., when TWD/JPY drops below 4.80), averaging costs. Cost is about 500-1000 yuan.

Suitable for those experienced with forex and using foreign currency accounts regularly. After exchange, you can even transfer directly into yen fixed deposits (current annual rate 1.5-1.8%) to generate passive income.

Fourth: 24-hour foreign currency ATM withdrawal

Use a chip-enabled bank card to withdraw yen cash from foreign currency ATMs, directly debiting from TWD account, with only 5 yuan cross-bank fee. E.SUN Bank’s foreign currency ATMs have no currency conversion fee, with a daily limit of 150,000 TWD, suitable for emergencies.

Cost is about 800-1200 yuan. The downside is limited locations (about 200 nationwide) and fixed denominations (1000, 5000, 10000 yen). During peak times (like before long holidays), cash may run out quickly, so don’t wait until the last minute.

Numbers speak: Cost comparison for exchanging 50,000 TWD

The core logic is simple: the closer the rate is to the market spot, the less the loss. Online currency exchange offers the best cost-performance ratio, especially for budgets of 50,000 to 200,000 yuan.

Is it worth entering now?

At the start of the year, TWD/JPY was about 4.46; now it’s 4.85, appreciating roughly 8.7%. This means the same yen assets are now worth more in TWD.

But more importantly, “timing” matters. The Bank of Japan is on the verge of rate hikes in December. USD/JPY has fallen from a high of 160 at the start of the year to 154.58. Market expectations suggest a short-term rebound to 155, but medium to long-term levels may stay below 150. This indicates the yen still has room to appreciate.

Advice for investors: Don’t exchange everything at once; buy in stages. You might do:

• First: Use online currency exchange for airport pickup (lock in cash needs)
• Second: Use foreign currency ATM for staged withdrawals (spread out entry costs)
• Third: Use online exchange to keep funds in foreign currency accounts (prepare for fixed deposits or investments)

Although the 200 yen fluctuation seems small, a staged approach can effectively reduce exchange rate risk.

After exchanging for yen, don’t let it sit idle

Exchanging is not the end but the start of a new journey.

Fixed deposit options: E.SUN, Taiwan Bank, etc., offer foreign currency accounts starting from 10,000 yen, with annual interest rates of 1.5-1.8%, stable but low yield.

Insurance options: Cathay, Fubon life offer yen savings insurance with guaranteed rates of 2-3%, locking in medium-term returns.

ETF options: Yuanta 00675U, 0070300703, and other yen index ETFs, can be bought in fractional shares, suitable for dollar-cost averaging and participating in yen appreciation.

Trading options: Forex trading of USD/JPY or EUR/JPY to capture short-term volatility, but beware of risks.

While the yen is a strong safe-haven, it also moves in both directions. Global arbitrage unwinding or geopolitical conflicts could depress its value. For investment purposes, yen ETFs (annual management fee 0.4%) are a good way to diversify risk.

Quick FAQs

Q. What’s the difference between cash rate and spot rate?
Cash rate applies to physical cash transactions, requiring on-the-spot delivery, and is more expensive. Spot rate involves no cash delivery (T+2 settlement) and offers better rates. In simple terms: digital transactions are cheaper, cash transactions are costly.

Q. How much yen can I get for 10,000 TWD?
Using Taiwan Bank’s December 10 cash selling rate of 4.85, 10,000 TWD yields about 48,500 yen. Using the spot sell rate (4.87), it’s about 48,700 yen, a difference of 200 yen (roughly TWD 40).

Q. What do I need to bring for in-branch exchange?
Taiwanese: ID card + passport; foreigners: passport + residence permit. Online reservation holders should also bring transaction notification. Under 20? Must be accompanied by a parent. Large amounts over 100,000 TWD may require source of funds declaration.

Q. What’s the limit for foreign currency ATM withdrawals?
Varies by bank. CTBC: 120,000 TWD/day; E.SUN: 150,000 TWD/day; Taishin: 150,000 TWD/day. It’s recommended to avoid cross-bank fees and plan ahead during peak times.

Final thoughts

The yen has evolved. It’s no longer just “pocket money” for travel but a versatile asset for safe-haven, yield, and investment purposes.

By 2025, with the TWD depreciation pressure persisting and the Bank of Japan’s rate hikes imminent, the yen story is just beginning. Mastering the principles of “staged exchange + not leaving money idle” will help you minimize costs and maximize gains—whether you’re planning a Tokyo shopping spree next year or trying to profit from volatility.

Beginners are advised to start with “Taiwan Bank online exchange + airport pickup” or “foreign currency ATM,” then shift into fixed deposits, ETFs, or small forex trades based on needs. This way, travel becomes more cost-effective, and you gain an extra layer of protection amid global market turbulence.