Is the time to exchange Japanese Yen by the end of 2025 coming? An evaluation of 4 major currency exchange options amid the depreciation of the New Taiwan Dollar

Recently, the NT dollar to Japanese Yen exchange rate has reached 4.85, an 8.7% appreciation from 4.46 at the beginning of the year. Many people are starting to seriously consider the timing of exchanging for Yen. But the key question is: Is now a good time to exchange? What method should be used? And after exchanging, how can the money be made to grow?

Is now the right time to exchange for Yen?

Simply put: Yes, but it should be done in batches.

According to the latest market signals, the Bank of Japan Governor Ueda Kazuo recently issued hawkish comments, with market expectations of an 80% chance of interest rate hikes, expecting a 0.25 bps increase to 0.75% on December 19 (a 30-year high). Japanese bond yields have hit a 17-year high of 1.93%, and USD/JPY has fallen from 160 at the start of the year to around 154.58.

What does this mean? The Yen, as one of the world’s three major safe-haven currencies (alongside the US dollar and Swiss franc), tends to attract capital during times of increased global uncertainty. For Taiwanese investors, exchanging Yen amid NT dollar depreciation pressure can hedge against Taiwan stock volatility and also benefit from Yen appreciation potential.

But there’s a risk here: short-term arbitrage closing positions could trigger 2-5% volatility. Therefore, the smartest approach is to enter in batches rather than going all-in at once.

Real cost comparison of 4 currency exchange options

Many think that exchanging Yen at the bank by queueing is enough, but in reality, the cost differences among various methods can reach over NT$1,500 (based on NT$50,000). Here’s a breakdown:

Option 1: Bank counter cash exchange (traditional but expensive)

Bring NT dollar cash directly to the bank or airport counter to exchange for Yen cash. Although the operation is straightforward, it uses the “cash selling rate” (1-2% worse than the spot rate), making it the most costly.

Cost estimate: Based on Taiwan Bank’s rate on December 10, 2025, the cash selling rate is about NT$0.2060 per Yen (i.e., NT$1 = 4.85 Yen). NT$50,000 would roughly lose NT$1,500-2,000. Plus, some banks charge handling fees (e.g., E.Sun, E.SUN each NT$100; Cathay United Bank NT$200), increasing overall costs.

Suitable for: Urgent airport needs, small amounts, or those unfamiliar with online operations.

Option 2: Online currency exchange + airport pickup (best value)

No need to open a foreign currency account. Simply reserve the exchange online via the bank’s website, fill in amount, currency, pickup branch, and date. After completion, present ID and transaction notification to pick up in person. Taiwan Bank’s “Easy Purchase” online exchange has no handling fee (pay via Taiwan Pay, only NT$10), with about 0.5% better exchange rate.

Cost estimate: NT$50,000 would lose about NT$300-800, much lower than in-person exchange. Also, Taoyuan Airport has 14 Taiwan Bank outlets (including 2 open 24 hours), making pre-trip pickup very convenient.

Suitable for: Travelers with a planned schedule, booking in advance before departure. This is currently the most cost-effective method.

Option 3: Online exchange + foreign currency ATM withdrawal (24-hour flexibility)

Use banking app or online banking to convert NT dollars into Yen and deposit into a foreign currency account (using the spot rate). When cash is needed, use a chip-enabled debit card at foreign currency ATMs to withdraw. E.Sun Bank’s foreign currency ATMs support direct withdrawal of Yen from NT dollar accounts, with a daily limit of NT$150,000, no exchange handling fee, and only NT$5 interbank fee.

Cost estimate: NT$50,000 would lose NT$500-1,000. Advantages include 24-hour operation and instant withdrawal; disadvantages are limited ATM locations (about 200 nationwide) and possible cash shortages during peak times.

Suitable for: People who can’t go to the bank in person and need flexible withdrawal options.

Option 4: Batch entry + fixed deposit for appreciation (investment mindset)

If the goal isn’t just to exchange cash for travel, but to allocate Yen assets, you can use online exchange to buy in batches and deposit Yen into fixed deposits for profit. E.Sun Bank, Taiwan Bank, and others offer foreign currency accounts starting from 10,000 Yen. Current Yen fixed deposit annual interest rates are 1.5-1.8%, much higher than NT$0.5%.

Cost estimate: NT$50,000 would lose NT$200-500 (saving on cash withdrawal fees). However, this approach requires forex experience and time to observe exchange rate trends.

Suitable for: Investors with forex experience who want to hold Yen assets long-term.

Quick comparison table of the 4 exchange options

How to grasp the timing of exchanging for Yen?

If you decide to exchange Yen, here is the core logic:

Short-term (1-3 months): The Bank of Japan’s rate hike is imminent. USD/JPY may test 155 in the short term, but medium to long-term forecasts suggest below 150. It’s recommended to enter in 3-4 batches rather than all at once, to avoid short-term volatility damaging your principal.

Mid-term (3-6 months): Keep an eye on US rate cuts and BOJ policies. If US rate hikes slow and Yen rate hikes accelerate, Yen will enter a genuine appreciation cycle.

After exchanging? This is crucial. If you convert Yen and leave it idle (no interest), you’re just losing out on the exchange rate difference. It’s recommended to shift into one of the following:

• Yen fixed deposit: Annual interest 1.5-1.8%, low risk
• Yen ETFs (e.g., 00675U): Track Yen index, management fee 0.4% annually, suitable for dollar-cost averaging
• Yen forex trading: Like USD/JPY swing trading, 24-hour trading to capture exchange rate movements
• Yen insurance policies: Hold long-term, with guaranteed interest rates of 2-3%

Quick FAQ

Q. How much is the difference between cash exchange rate and spot rate?
Cash exchange rate is usually 1-2% worse than the spot rate, meaning you get less Yen for your money.

Q. How many Yen can I get for NT$10,000 now?
Based on December 10 rate of 4.85, NT$10,000 exchanges for about 48,500 Yen (cash sale) or 48,700 Yen (spot sale).

Q. What do I need to bring for counter exchange?
ID + passport (for foreigners, passport + residence permit). Large amounts (over NT$100,000) may require source of funds declaration.

Q. Is there exchange rate risk after exchanging Yen?
Yes, Yen fluctuates both ways. BOJ rate hikes are positive for Yen, but global arbitrage unwinding or geopolitical conflicts could depress it. Diversify with Yen ETFs or fixed deposits to manage risk.

Summary: Framework for deciding the timing of Yen exchange

If you ask, “Is it worthwhile to exchange Yen now?” the answer is: Worthwhile, but depends on your purpose and method.

• Travelers: Use “online exchange + airport pickup” to save at least NT$1,000.
• Investors: Enter in batches, then move into fixed deposits or ETFs, hedging against NT dollar depreciation.
• Urgent needs: Use foreign currency ATMs for quick access, avoiding queues.

Remember two principles: Batch exchange, and don’t just sit on the exchange. This way, you can maximize gains and minimize costs in your Yen exchange timing.