## Is the Taiwanese Dollar Depreciating? Is Now the Right Time to Exchange for Yen? Understanding 4 Currency Exchange Methods

**Core Answer: Yes, but with some considerations.** As of December 2025, the TWD to JPY exchange rate is about 4.85, appreciating 8.7% since the beginning of the year. The Bank of Japan is on the verge of raising interest rates, and the yen’s safe-haven attribute is strengthening, prompting many to seriously consider exchanging for yen. But here’s the question — do you know which method is the most cost-effective?

### Why Talk About Yen Investment Now? Dual Appeal of Hedging + Returns

The yen isn’t just pocket money for travel abroad. From a financial market perspective, the yen is one of the world’s three major safe-haven currencies (alongside USD and Swiss Franc). When geopolitical risks rise, capital flows into yen for safety. During the Russia-Ukraine conflict in 2022, the yen appreciated 8% in a week, successfully buffering stock market declines. For Taiwanese investors, holding yen adds an extra layer of protection.

At the same time, the Bank of Japan’s interest rate hike cycle is about to start — Ueda Kazuo’s hawkish comments have pushed market expectations of rate hikes to 80%, with a projected increase of 0.25 basis points to 0.75% in December (a 30-year high). Japanese government bond yields have hit a 17-year high of 1.93%. This indicates increased future yield potential for yen assets.

### 4 Currency Exchange Strategies Compared: Which One Should You Choose?

**Option 1: Bank Counter Cash Exchange — Traditional but Expensive**

Go to a bank and exchange cash directly for yen bills. The simplest method, but the cost is the spread — banks sell at a “cash selling rate” about 1-2% worse than the market spot rate. For example, Taiwan Bank’s cash selling rate is about 0.2060 TWD/JPY. Exchanging 50,000 TWD results in a loss of roughly 1,500-2,000 TWD.

Who’s it for: Those without time to research, in urgent need (like at the airport), or only exchanging small amounts.

**Option 2: Online Currency Exchange to Foreign Currency Account — Flexible but with Barriers**

Use bank apps or online banking to exchange currency into a foreign currency account, at a “spot selling rate” with about 1% discount. If you want cash later, you can withdraw, but there will be additional fees (starting at 100 TWD). The advantage is you can stagger entries to average costs, and combine with fixed deposits earning 1.5-1.8% annual interest.

Who’s it for: Those experienced with forex, wanting to observe exchange rates while investing, or planning to deposit yen for interest.

**Option 3: Online Currency Conversion + Branch Pickup — Best Before Travel**

This is the smartest move: pre-arrange currency exchange on the bank’s website and pick up at Taoyuan Airport branch. Taiwan Bank’s “Easy Purchase” has no handling fee (only 10 TWD if paid via TaiwanPay), with about 0.5% better rate. Taoyuan Airport has 14 Taiwan Bank outlets, including two open 24 hours, allowing you to pick up cash directly before departure. The loss on 50,000 TWD is only about 300-800 TWD.

Who’s it for: Planning to travel, wanting cash at the airport, or not wanting to make extra trips to the bank.

**Option 4: Foreign Currency ATM Withdrawal — 24/7 Access, but Lucky or Not**

Use a chip-enabled debit card at foreign currency ATMs to withdraw yen, with a cross-bank fee of only 5 TWD. E.SUN Bank’s daily limit is equivalent to 150,000 TWD, allowing withdrawals of 1,000/5,000/10,000 yen denominations. The biggest advantage is 24/7 access anywhere. But pitfalls include limited ATMs nationwide (about 200), and cash shortages during peak times (especially at airports).

Who’s it for: Urgent needs, late-night travel, or residents near foreign currency ATMs.

### Cost Comparison for Exchanging 50,000 TWD into Yen

| Method | Loss Cost | Advantages | Disadvantages |
|---------|--------------|--------------|----------------|
| Bank Counter Cash | 1,500-2,000 TWD | Safe, immediate | Worst exchange rate, limited hours |
| Online Currency Exchange | 500-1,000 TWD | Better rate, staggered entry | Need foreign currency account, withdrawal fees |
| Online Currency Conversion + Branch Pickup | 300-800 TWD | Best rate, airport pickup | Need reservation, branch hours limited |
| Foreign Currency ATM | 800-1,200 TWD | 24/7, low cross-bank fee | Limited cash, few locations |

**Quick Tip:** For beginners with a budget of 50,000–200,000 TWD, the most cost-effective approach is “Online currency conversion + airport pickup” or “Foreign currency ATM.”

### After Exchanging Yen, Don’t Let Your Money Sit Idle

Exchanging yen is just the first step. Next, consider four options:

**Fixed Deposit:** E.SUN, Taiwan Bank foreign currency accounts, starting from 10,000 yen, with annual interest rates of 1.5-1.8%, safe and steady.

**Insurance Products:** Cathay, Fubon life savings insurance, with guaranteed interest rates of 2-3%, locking in medium-term returns.

**Growth Investments:** ETFs like Yuanta 00675U, 00703, which track yen, can be bought in fractional shares, suitable for dollar-cost averaging.

**Trading:** Forex trading of USD/JPY or EUR/JPY, to capture short-term fluctuations, but with higher risk.

### Risks and Opportunities of Exchanging Yen Now

While the yen is a safe-haven asset, it’s not only appreciating. The US rate-cut cycle supports the yen, but global arbitrage unwinding or geopolitical conflicts (Taiwan Strait, Middle East) could push it down. Short-term volatility could be 2-5%.

However, in the medium to long term, USD/JPY has fallen from a high of 160 at the start of the year to around 154.58, and is expected to oscillate below 150 — a sign of gradual yen strengthening.

**Suggested Strategies:**
- For travel: exchange now using “online currency conversion” — most cost-effective.
- For hedging: stagger entries over 2-3 times to reduce risk.
- For investment returns: after exchange, move funds into fixed deposits or ETFs to enjoy interest benefits.

The yen is no longer just a travel currency but an asset that can hedge and generate income. By following the principles of “staggered, low-cost, and post-exchange allocation,” you can save money on trips and add a layer of protection amid global market volatility.