Is Yen investment booming? A lazy guide to currency exchange during the NT$ to Yen 4.85 era

December 2025, the Taiwan dollar against the Japanese yen reached 4.85. This exchange rate has attracted the attention of many investors and travelers. Since the beginning of the year, the yen has appreciated by 8.7%. Under the pressure of Taiwan dollar depreciation, many people are starting to seriously consider allocating assets in yen. But the question is, how to exchange without losing out? This article breaks down five major currency exchange channels, compares actual costs, and explores financial planning options after the exchange.

Why talk about the yen now? Three key aspects analysis

Aspect 1: Rigid demand for travel and purchasing代理

Japan remains the top choice for Taiwanese traveling abroad. Tokyo, Osaka, Hokkaido— from shopping to skiing to vacations, many merchants only accept cash (credit card acceptance rate is only 60%). Additionally, consumers purchasing Japanese cosmetics, clothing, and anime peripherals often need to pay directly in yen. International students and working holidaymakers exchange currency in advance to hedge against exchange rate fluctuations. This demand is stable and ongoing.

Aspect 2: Strategic value of the safe-haven currency

The yen is one of the three major global safe-haven currencies (alongside USD and Swiss Franc). Japan’s economy is stable, debt is well-controlled, and during market turbulence, funds flow into yen as a hedge. For example, during the Russia-Ukraine conflict in 2022, the yen appreciated 8% in a week, buffering a 10% decline in the stock market. For Taiwanese investors, exchanging yen is not just for leisure spending but also a tool to hedge Taiwan stock risk.

Aspect 3: Subtle mechanism of arbitrage trading

Japan maintains ultra-low interest rates (currently only 0.5%), making the yen a typical “funding currency.” Many investors borrow yen at low interest, convert to higher-yield USD (the USD/JPY interest rate differential reaches 4%), and when risks rise, close positions to buy back yen. The risk of this arbitrage is that if market volatility intensifies, a wave of closing positions can cause short-term pressure on the yen.

Is it profitable to exchange yen now? Quick overview of exchange rate trends

According to Taiwan Bank’s rate on December 10, 2025, the cash selling rate is about 0.2060 TWD per yen (roughly 4.85 yen per TWD). Compared to the early-year level of 4.46, the yen has appreciated by 8.7%, which is a significant exchange gain. In the second half of the year, Taiwan’s currency exchange demand increased by 25%, mainly driven by tourism recovery and hedging needs.

Short-term fluctuations and medium-long-term trends:

The Bank of Japan (BOJ) has reached a market consensus on raising interest rates. Governor Ueda Kazuo’s recent hawkish comments pushed expectations of a rate hike to 80%, with a 0.25 bps increase to 0.75% expected at the December 19 meeting (a 30-year high). Japanese government bond yields have risen to 1.93%, a 17-year high. The USD/JPY has fallen from the high of 160 at the start of the year to 154.58; short-term volatility may bring it to around 155, but the medium-long-term forecast is below 150.

Investment suggestion: Yes, exchanging yen now can be profitable, but it’s advisable to do so in batches. The short-term arbitrage risk (possible 2-5% fluctuation) suggests avoiding all-in exchanges at once.

Five major channels for exchanging yen in Taiwan

1. Bank counter cash exchange

Bring cash in TWD directly to bank branches or airport counters to exchange immediately for yen cash. This is the most traditional method, with advantages of safety and full denominations (1,000, 5,000, 10,000 yen options). The downside is the highest cost—using the “cash sell rate” (about 0.2060 TWD/yen) is 1-2% worse than the spot rate, and some banks charge handling fees.

Cost estimate: Exchanging 50,000 TWD results in a loss of about 1,500-2,000 TWD.

Suitable for: Urgent needs, unfamiliar with online operations.

2. Online transfer to foreign currency account

Use bank app or online banking to convert TWD into yen and deposit into a foreign currency account. This method uses the “spot sell rate” (about 0.2057 TWD/yen), offering a 1% better rate than cash sell. If you need to withdraw cash later, you can do so via foreign currency ATMs or counters, but a withdrawal fee starting from 100 TWD applies.

This approach allows you to observe exchange rate trends, and when rates are low (e.g., TWD/JPY below 4.80), to enter in batches for an average cost.

Cost estimate: Exchanging 50,000 TWD results in a loss of about 500-1,000 TWD.

Suitable for: Those experienced in forex, using foreign currency accounts regularly, considering yen fixed deposits (currently 1.5-1.8% annual interest).

3. Online currency exchange + airport designated pickup

No need to pre-open a foreign currency account. Fill in the amount, branch, and date on the bank’s website, complete the transfer, then bring ID and transaction notice to pick up in person. Taiwan Bank’s “Easy Purchase” online exchange has no handling fee (pay via TaiwanPay, only 10 TWD), with about 0.5% exchange rate advantage.

Taoyuan Airport has 14 Taiwan Bank counters, including 2 open 24 hours, ideal for pre-arranged pickup before departure.

Cost estimate: Exchanging 50,000 TWD results in a loss of about 300-800 TWD.

Suitable for: Planned travelers who want to pick up cash directly at the airport.

4. Foreign currency ATM instant withdrawal

Use a chip-enabled financial card to withdraw yen at foreign currency ATMs, available 24 hours. Deducts only 5 TWD cross-bank fee from TWD account, no exchange fee. Fubon Bank’s foreign currency ATMs have a daily withdrawal limit of 150,000 TWD.

Disadvantages include about 200 foreign currency ATMs nationwide, fixed denominations (1,000/5,000/10,000 yen), and during peak times (especially at airports), cash may run out.

Cost estimate: Exchanging 50,000 TWD results in a loss of about 800-1,200 TWD.

Suitable for: Urgent needs, busy professionals without time for counters.

5. Cross-bank transfer to a Japanese account (advanced option)

If you already have a bank account in Japan, you can use Taiwan Bank’s international transfer feature to send TWD directly and automatically convert to yen. Suitable for long-term residents or frequent cross-border transactions, with costs between online exchange and ATM.

Comparison table of five exchange methods

Three key concepts to understand before currency exchange

What’s the difference between cash rate and spot rate?

Cash Rate is the rate banks offer for physical cash (banknotes and coins), used for travel exchange or on-the-spot transactions. The advantage is immediate cash; the disadvantage is that it’s usually 1-2% worse than the spot rate, plus higher handling costs.

Spot Rate is the exchange rate settled within two business days (T+2) in the forex market, used for electronic transfers, non-cash settlements (interbank settlement, import/export, foreign currency accounts). It’s closer to international market prices but requires waiting for settlement.

Actual difference: Taiwan Bank’s cash sell rate is about 0.2060, while the spot sell rate is about 0.2057. The difference may seem small, but exchanging 50,000 TWD results in a difference of about 200-300 yen (roughly 40-60 TWD).

How many yen for 10,000 TWD?

Simple calculation: Yen amount = TWD amount × current rate

Using Taiwan Bank’s rate on December 10 (cash sell 4.85):

• 10,000 TWD × 4.85 = 48,500 yen (cash)
• Using spot rate 4.87: 10,000 TWD × 4.87 = 48,700 yen (transfer)
• Difference: 200 yen, roughly 40 TWD.

What documents are needed for currency exchange?

Personal exchange: ID card + passport
Foreigners: Passport + residence permit
Company: Business registration documents
Online reservation pickup: Transaction notice

Special regulations:

• Under 20 needs parent’s consent and accompanying
• Large amounts (over 100,000 TWD) may require source of funds declaration

Quick reference of bank rates and fees as of December 10, 2025

Tip: Taiwan Bank and Fubon Bank offer the best rates (0.2058-0.2060), but Fubon charges handling fees; CTBC Bank has slightly worse rates but no fees, suitable for small exchanges.

How to make money after getting yen? Four major financial options

After exchanging yen, don’t let it just sit idle in your account. Here are four options suitable for small-scale beginners:

Option A: Yen fixed deposit (conservative)

Open a foreign currency account at E.SUN or Taiwan Bank, deposit yen online. Minimum 10,000 yen, annual interest rate 1.5-1.8%. Compared to TWD fixed deposits (~1.2%), earning an extra 0.3-0.6%. Suitable for conservative investors, with limited but stable liquidity.

Option B: Yen insurance policy (mid-term protection)

Cathay, Fubon Life offer yen savings insurance, with guaranteed interest rates of 2-3%, typically 5-7 years. Combines protection and interest, but liquidity is poor, early surrender incurs losses.

Option C: Yen ETFs (growth-oriented)

Yuan Da 00675U, Fubon 00703 tracking yen indices, can be bought as fractional shares via broker apps. Management fee about 0.4%, suitable for those optimistic about medium-long-term yen appreciation. More volatile than fixed deposits but with higher growth potential.

Option D: Forex swing trading (advanced)

Trade USD/JPY or EUR/JPY directly on forex platforms like Mitrade. Both long and short positions, 24-hour trading, small capital required. Advantages are flexibility and efficiency; risks are high, requiring technical analysis.

Important: BOJ rate hikes are positive for yen; but global arbitrage unwinding or geopolitical risks (Taiwan Strait, Middle East) may suppress it. Always assess risk tolerance before investing in yen.

Three common pitfalls in currency exchange and how to handle

Pitfall 1: Waiting until the last minute

Many people tend to do last-minute currency exchange before travel. Result: airport ATMs run out of cash, long queues at banks, and end up accepting worse rates. It’s better to pre-arrange online exchange 1-2 weeks ahead.

Pitfall 2: All-in one shot

A 2-5% fluctuation in exchange rate is normal. If you exchange 50,000 TWD all at once and face a 2% adverse move, you lose 1,000 TWD. Smarter to split into three parts, each 15,000-20,000 TWD, to diversify risk.

Pitfall 3: Ignoring cumulative handling fees

Handling fees of 5 TWD or 100 TWD may seem small, but add up. If you withdraw via ATM three times, cross-bank fee totals 15 TWD; if counters charge 200 TWD, a single exchange can cost 500 TWD. Compare the hidden costs of all five options carefully.

Final tips: Lazy quick solution

Beginner combo: Online exchange (Taiwan Bank Easy Purchase) + airport pickup

• No fee, good rate, most convenient

Investment combo: Online transfer (E.SUN App) + yen fixed deposit

• Batch entry, invest and save simultaneously, with good interest

Conservative combo: Foreign currency ATM (lowest cross-bank fee) + cash reserve

• 24/7 flexibility, emergency ready

Advanced combo: Cross-border transfer + ETF lump sum + forex swing trading

• For experienced investors

Key takeaways

The yen is no longer just for travel pocket money; it also functions as a hedge and investment asset. Under the TWD/JPY rate of 4.85, using batch exchange, leveraging low-cost channels, and actively managing assets after exchange are the right strategies. Whether preparing for next year’s trip to Japan or increasing asset allocation amid TWD depreciation pressure, following the principles of “diversify risk + cost awareness + active appreciation” can maximize the benefits of yen investment.