Idea
Why is the Yen Moving–and What Does That Mean if You Have Expenses in Japan
by
iFAST Global Bank
If you have a holiday, tuition payment, property costs, or other expenses in Japan, recent moves in the Japanese yen might have caught your attention. The important point isn't that sharp currency movements mean a clear time to exchange. Instead, focus on understanding what's actually moving the yen can help you plan your cash needs with greater financial confidence. This guide explores how.
Why is the yen moving so sharply?
The yen's movements aren't down to one single source, but a multitude of factors that have come together to create unpredictability.
On 18 September 2025, the Bank of Japan raised its policy rate from 1.00% to 1.25%, which is its highest level in 31 years. However, the vote to raise rates was not unanimous, with 2 members of the committee dissenting. (source). The dissent and uncertainty reflected into the market, causing uncertainty in the yen's value.
There's also the possibility of direct government intervention. Japan's Ministry of Finance is responsible for deciding on FX intervention, and they had previously conducted a joint intervention with the US to buy yen in order to stabilise it from falling (source).
What does this mean if you have expenses in Japan?
The practical question is less about predicting where the yen will end up, and more about how much yen you'll end up needing, and when you need it.
Suppose you need ¥1 million for a payment that's due in 3 months. A change in the exchange rate can alter the amount of home currency that you'll need to fund that payment. As the yen strengthens, that same expense will cost you more. If the yen weakens, it'll end up costing less.
The level of uncertainty currently surrounding the Yen can make budgeting a hassle. Rather than trying to call the market out, it's best to consider how you can better deal with the current circumstances.
Plan ahead: map out your known yen expenses and future payment dates.
Decide when to convert: consider if it’s better to convert in portions, or simply to make one large conversion. Use current cashflow needs to weigh your options.
Holding yen already: if you’re already holding yen, keeping your money as-is can reduce the need to convert at a later date.
Monitoring the drivers: Bank of Japan decisions, government intervention, and other market factors can all affect the yen
Make the job easier
Keeping track of your money in different currencies can be difficult. You may convert some money into yen for an expense in a week, only to discover that you've already converted that money a few days ago. Customers of iFAST Global Bank don't need to worry about that issue, because the iFAST Global Bank Multi-Currency Current Account holds up to 11 different currencies, including Japanese yen. Customers will be able to see their balances across all 11 currencies, ensuring that they won't accidentally convert money that they already converted days earlier. When banking with iFAST Global Bank, customer also earn interest on all 11 currencies, just by having their money sit inside their Multi-Currency Current Accounts, so you don't have to worry about converting at the last minute*. And even if you make a conversion by mistake, iFAST Global Bank's market-competitive and fee-free conversions ensure that you get a fair deal for your currency, and that you can convert it back with minimal risk.
* 18+, Interest rates are variable and are subject to change. Details regarding the interest rates can be found on our website at www.ifastgb.com. Please refer to our website for full terms and conditions. Deposits up to £120,000 are fully protected by FSCS (Financial Services Compensation Scheme). https://www.fscs.org.uk/ has further details on the scheme.
Focus on what you can control
Trying to outsmart the market is near-impossible. There are so many variables to consider and deal with, so it simply isn't practical to attempt to do so. However, it's possible to deal with market fluctuations in your own way, by focusing on what you can deal with. Knowing what future expenses will require JPY, and when those expenses are due, can be valuable knowledge. Banking with iFAST Global Bank is also a valuable tool, as the iFAST Global Bank Multi-Currency Current Account allows you to view your wealth across currencies, including in JPY, to ensure that you don't make any unnecessary conversions.
Managing market uncertainty isn't about trying to beat the market, it's about making sure your own finances and expenses are protected before anything else.
iFAST Global Bank is a member of the Financial Services Compensation Scheme (FSCS).
iFAST Global Bank is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Our Financial Services Register number is 716167. We are registered in England and Wales, our company number is 4797759.
Please note that the provided details serve as general information and should not be considered as financial advice or endorsements. We strongly advise customers to diligently carry out their own research and consider seeking expert guidance for tailored financial choices.
