Yen investment is booming! Exchange rate opportunity in 2025 with TWD to JPY at 4.85

Yen Appreciates by 8.7%, Creating a Golden Opportunity for Currency Exchange

On December 10, 2025, the Taiwanese dollar (TWD) against the Japanese yen (JPY) broke through the 4.85 mark—what opportunities lie behind this number?

At the beginning of the year, it was still 4.46, representing an 8.7% increase in just one year. For Taiwanese investors, this is not just a currency exchange issue for travel abroad, but a new option for asset allocation. Especially when the TWD faces depreciation pressure and stock market volatility intensifies, the yen, as one of the world’s three major safe-haven currencies, is quietly becoming a safe harbor for small investors’ assets.

According to market observations, Taiwan’s currency exchange demand in the second half of the year increased by 25%, with over 60% coming from hedging strategies rather than pure travel needs. This time, exchanging yen is not just for buying cosmetics and anime merchandise.

Why is it worth exchanging for yen? A dual role of hedging + profit

1. Hedging attribute: One of the three major global safe-haven currencies

Japan’s economy is stable, with a sound debt structure. The yen has long been listed alongside the US dollar and Swiss franc as one of the most reliable safe-haven assets worldwide.

When markets are turbulent, capital flows into the yen. During the Russia-Ukraine conflict in 2022, the yen appreciated by 8% in a single week, while global stock markets fell by 10% in the same period. In other words, your yen holdings are helping to “stop the bleeding” from your Taiwanese stocks’ declines.

2. Profit opportunity: Interest rate arbitrage is shifting

The Bank of Japan (BOJ) has recently changed its stance. Governor Ueda Kazuo has made hawkish remarks, and the market expects an 80% chance of rate hikes. The upcoming meeting (expected December 19) may raise interest rates by 0.25 basis points to 0.75%—the highest in Japan in 30 years.

This means:

• The yen’s fixed deposit annual interest rate has jumped from 0.1% to 1.5-1.8%
• Japan’s 10-year government bond yield has hit a 17-year high of 1.93%
• The USD/JPY interest rate differential may narrow from 4.0% to around 2.5%

3. Practical application scenarios

Besides investment, yen is indispensable in daily life:

• Travel cash needs: Japan still relies heavily on cash; credit card penetration is only 60%
• Cross-border consumption: Japanese purchasing agents, cosmetics, anime merchandise often require direct remittance
• Long-term asset allocation: Combining yen fixed deposits, ETFs, or forex trading

Is now a good time to exchange for yen? The answer is complicated

Short-term view: USD/JPY has fallen from a high of 160 at the start of the year to 154.58. It may test around 155 in the short term, but the medium to long-term trend is weak (expected to fall below 150).

Mid-term view: The BOJ’s rate hikes are a new variable supporting the yen. Meanwhile, the US is entering a rate-cut cycle, with the Federal Funds Rate gradually decreasing from 5.25-5.50%. The interplay of these forces may cause yen fluctuations in the 2-5% range.

Investment conclusion: Exchanging yen now is not about “one-time full conversion,” but rather “staged deployment.” Divide 100,000-200,000 TWD into 3-4 installments to avoid missing out on gains and to mitigate the risk of converting everything at a high point in one go.

Four major channels for exchanging yen in Taiwan, with surprisingly different costs

Many think exchanging yen is just queuing at banks, but the cost differences among channels can add up to an extra NT$2,000. Let’s break down real data.

Method 1: In-person cash exchange—most traditional but highest cost

Bring cash in TWD directly to a bank or airport counter for immediate yen cash exchange.

Cost components:

• Using “cash selling rate” (1-2% worse than spot rate)
• Some banks charge an additional NT$100-200 handling fee
• For NT$50,000, total loss is NT$1,500-2,000

Taiwan Bank’s rate as of 2025/12/10: Cash selling 1 yen = NT$0.2060 (equivalent to NT$1 = 4.85 yen)

Suitable for: Small, urgent needs, airport emergencies, unfamiliar with online methods

Method 2: Online currency exchange + in-person withdrawal—an intermediate solution

Use bank app or online banking to convert TWD to yen and deposit into a foreign currency account (using “spot selling rate,” about 1% discount), then withdraw cash at bank or foreign currency ATM.

Cost components:

• Rate advantage, loss of NT$500-1,000 per NT$50,000
• Need to open a foreign currency account (free, some banks require minimum deposit)
• ATM withdrawal fee of NT$5-100

Advantages: Can stagger entries for average cost, operate anytime 24/7

Suitable for: Those experienced in forex, planning to hold yen long-term

Method 3: Online currency exchange + airport pickup—smartest travel plan

No need for a foreign currency account. Reserve exchange amount and branch pickup (e.g., at the airport) online, then pick up cash with ID and transaction notice before departure.

Cost components:

• Taiwan Bank’s “Easy Purchase” online exchange fee waived (NT$10 if paid via TaiwanPay)
• About 0.5% exchange rate advantage, loss NT$300-800 per NT$50,000
• Need to book 1-3 days in advance

Super advantage: Taoyuan Airport has 14 Taiwan Bank outlets, 2 of which operate 24 hours, allowing cash pickup on departure day or the night before

Suitable for: Well-planned travelers before trips

Method 4: Foreign currency ATM withdrawal—fastest but most limited

Use a chip-enabled debit/credit card at foreign currency ATMs to withdraw yen cash directly, available 24 hours, with only NT$5 cross-bank fee.

Cost components:

• Deducted directly from TWD account (no intermediate transfer fee)
• Loss of NT$800-1,200 per NT$50,000
• Daily withdrawal limits vary by bank (E.SUN Bank: NT$150,000; CCB: NT$120,000)

Limitations:

• Limited locations nationwide (~200)
• Fixed denominations: 1,000/5,000/10,000 yen
• Stockouts during peak times (especially at airports)

Suitable for: Urgent needs, busy professionals without time to visit banks

Cost comparison table of 4 methods

Editor’s tip: For budgets of NT$50,000-200,000, the most cost-effective combo is “online pre-order + airport pickup,” saving money and convenient.

Latest yen exchange rates and the chain reaction of BOJ rate hikes

The upcoming December 2025 BOJ meeting will be a turning point for the yen exchange rate.

Background:

• BOJ Governor Ueda Kazuo’s hawkish stance has raised expectations of rate hikes to 80%
• The US Federal Reserve is entering a rate-cut cycle (gradually lowering from 5.25-5.50%)
• The US-Japan interest rate differential has narrowed from 4.0% to about 2.5-3.0%

Impact on exchange rate:

• USD/JPY may rebound to around 155 in the short term, but the mid-term target is below 150
• Yen volatility is expected in the 2-5% range
• Long-term, the yen benefits from rate hikes, but short-term fluctuations pose arbitrage and closing risks

What should investors do:

1. Travelers: Exchange now, no need to wait, to avoid future rate hikes pushing up costs
2. Investors: Stagger entries in 3-4 rounds, 1-2 weeks apart, to average exchange rate risk
3. Hedgers: Consider allocating 20-30% of assets into yen, holding long-term

Next steps after getting yen: let your money work

After exchanging yen, don’t leave it idle—there are 4 options to generate returns.

Option 1: Yen fixed deposit—steady income

• Annual interest rate 1.5-1.8% (a recent high in Japan)
• Minimum NT$10,000 equivalent
• Suitable for conservative investors
• Recommended banks: Taiwan Bank, E.SUN Bank, Mega International Bank

Option 2: Yen insurance policy—medium-term protection

• Cathay, Fubon Life offer savings insurance
• Guaranteed interest rate 2-3%
• Lock-in for 6-10 years
• Suitable for stable cash flow needs

Option 3: Yen ETFs—trend growth

• Yuanta 00675U tracks yen index (annual management fee 0.4%)
• Taiwan 00703 also available
• Can buy fractional shares via broker app
• Suitable for periodic investment, holding 3-5 years

Option 4: Forex trading—active trading

• Directly trade USD/JPY or EUR/JPY
• Long and short positions, 24-hour trading
• Use stop-loss, take-profit, trailing stops
• Suitable for experienced traders

Risk warning: Although yen is a safe-haven currency, it still has two-way volatility risks. Global arbitrage closing or geopolitical conflicts (Taiwan Strait, Middle East) may weaken the yen. Do not go all-in on a single currency.

Cross-currency account transfers: RMB, yen, USD liquidity options

With upgraded cross-border remittance services, many are considering how to efficiently manage multi-currency assets. If you hold RMB or other foreign currencies and want to transfer to Taiwan accounts then convert to yen, here are key points:

RMB remittance to Taiwan:

• Must go through international remittance channels (SWIFT or RMB clearing banks)
• Currency conversion during transfer costs about 0.5-1.5%
• Recommended to choose banks that open RMB accounts (CITIC, Taishin, E.SUN)

Optimal solutions:

1. Convert RMB directly to yen (reducing one conversion step)
2. Or convert first to USD then to yen (USD has the best liquidity)
3. Avoid three-layer conversions: RMB→TWD→JPY

For large transfers across currencies, consult bank foreign exchange departments for preferential rates, possibly for corporate clients.

Quick FAQs

Q: What’s the difference between cash exchange rate and spot rate?

Cash rate applies to physical cash transactions (notes and coins), usually 1-2% worse than spot rate, with immediate delivery. Spot rate is used for electronic transfers, more favorable (close to international market), but settled T+2.

Q: How much yen can I get with NT$10,000?

Using Taiwan Bank’s cash selling rate of NT$4.85 per yen: NT$10,000 × 4.85 = 48,500 yen. Using the spot rate of NT$4.87, about 48,700 yen, a difference of 200 yen (~NT$40).

Q: What do I need to bring for in-person currency exchange?

ID card + passport. If booked online, also bring transaction notice. Under 20 years old requires parent accompaniment; large amounts (over NT$100,000) may require source declaration.

Q: What’s the daily withdrawal limit at foreign currency ATMs?

Varies by bank (as of October 2025):

• E.SUN Bank: NT$50,000 per transaction, NT$150,000 per day
• CCB: NT$120,000 per transaction and per day
• Others: usually NT$20,000 per transaction, daily limit depends on card issuer

RMB withdrawals have special limits: max NT$20,000 per transaction and per day.

It’s recommended to diversify withdrawals or use your own bank card to avoid cross-bank fees (NT$5 per transaction).

Final action plan

Yen is no longer just pocket money for travel but an asset class with hedging and investment value.

Beginner’s route:

1. Choose “Taiwan Bank online exchange + airport pickup” or “SinoPac foreign currency ATM” (lowest cost)
2. After exchange, diversify: 50% fixed deposit, 30% ETFs, 20% cash reserve
3. Keep an eye on BOJ rate hikes, and consider gradually increasing holdings

Advanced investment route:

1. Open a foreign currency account, stagger entries for average cost
2. Allocate yen ETFs for dollar-cost averaging
3. Learn to trade USD/JPY or EUR/JPY for trend trading

Whichever path you choose, the core principle is “staged exchange, don’t go all-in at once, review regularly.” This can provide extra protection amid global market turbulence and capture yen appreciation gains.

Under the pressure of TWD depreciation, the yen is quietly waiting for prepared investors. Are you ready?