Japanese Yen: An Introduction on the Currency of Japan

Everyday living consists of money. From buying necessities such as clothes, food, and drinks to traveling to other places, money is always involved. It is a way of paying another person or establishment in exchange for the goods or services that they provide. All around the world, there are various ways of barter, but the most common is by using monetary values. Every country has its own currency that it uses to trade goods and services. Currencies range from the U.S. dollar (USD), Euro (EUR), Swiss franc (CHF), South Korean won (KRW), Canadian dollar (CAD), and so much more. These currencies have their own distinct symbol, value, and history. As for Japan, the citizens use the Japanese yen or the JPY.

History Behind the Currency of Japan

The first formal system of currency in Japan was the Imperial currency or the Kōchōsen. Under the 43rd Imperial ruler of Japan in 708 CE, Empress Gemmei ordered the minting of the first official coin type of the country called the Wadōkaichin. It was named so because of the four words printed on the coin with Wadō meaning Japanese copper and could also mean happiness, and Kaichin meaning currency. This coin was 2.4 cm in diameters and weighed 3.75 kg – the same specific details as that of the Tang coinage from China called the Kaigentsüshō.

Soon after, there was a currency reform in 760 wherein the Wadōkaichin was debased due to the government issuing coins with a lesser content of metal. Not only that, but local imitations of the Wadōkaichin also progressed. Hence, three new coins were introduced in this era, namely, the copper coin called the Mannentsūhō, the silver coin called the Taiheigenbō, and the gold coin called Kaikishōhō. The Mannentsūhō was worth 10 Wadōkaichin, the Taiheigenbō was worth 10 copper coins, and the Kaikishōhō was worth 10 silver coins.

However, in 958, this system inevitably became debased because of the decreasing rate of the metallic content and value of the coins. Upon reaching the end of the 10th century, the people returned to using rice as their medium of currency. Between the 12th and 17th century, the Japanese adopted the Chinese coinage in their currency system. Some of the coins that were adopted from the Chinese Ming dynasty coins were the Eiraku Tsūhō and the Genpu Tsūhō. During the 16th century, local experiments were made in minting local coins made of copper and even gold with the emerging Edo period. The official currency of Japan became the copper Mon coins from the year 1336 to 1870 during the Muromachi period.

From the 17th to the 19th century, Shogun Tokugawa Ieyasu initiated the Tokugawa coinage during the Tokugawa period although this system was a unitary and independent one. The system consisted of bronze, silver and gold coins. However, this system was also debased, known as the Genroku Recoinage, as a way to solve issues in the government. On the other hand, the first notes to be issued in the country were issued in the year 1600 by Shinto priests. These notes were called the Yamada Hagaki.

When Japan opened its doors to the West in the year 1854, as the Tokugawa coinage was debased, foreign trading skyrocketed. During the Bakumatsu period in the year 1859, Mexican dollars were considered the official currency of the country, only their exchange rates were of three Bu, known as Aratame Sanbu Sadame.

How the Yen Symbol Came To Be

On the 27th of June in the year 1871, the New Currency Act was born. The Meiji government adopted a new currency system called yen, meaning a round object, as the dollar coinage of Japan. Like all dollars during that time, the yen was essentially a dollar unit with almost the same value as other dollars. The gold standard corresponding to the recommendation of the European Congress of Economists in Paris in the year 1867 was adopted with 1 yen equating to 24.26 grams of pure silver or 1.5 grams of pure gold. Aside from that, new notes called the Meiji Tsūhōsatsu were also issued in the year 1872, though they were printed in Germany.

As for the Yen currency sign (¥), it is currently used by both the Chinese yuan (CNY) and the Japanese yen. It is a monetary sign that is similar to that of the Latin letter Y with two horizontal strokes below the intersection of the lines. While it is pronounced as yuán in China, the Japanese pronounce it as en. The yen symbol comes before the value it represents, like ¥1000.

The Japanese Yen Consisting of Coins and Banknotes Today

While coins were first minted the year 1870, they still exist up to this day and are used for trading. The current Japanese yen currency system consists of both coins and banknotes. For the coins, there are basically six distinct coins in the market, namely, ¥1, ¥5, ¥10, ¥50, ¥100, and ¥500. They all have varying sizes, weight, and composition. The ¥1 is 20 mm in diameter and 1.2 mm thick, weighs 1 gram, and is made of 100% aluminum with a smooth edge along with an image of a young tree with the state title and value printed on the obverse while the value and year of minting printed on the reverse. ¥5 is 22 mm in diameter and 1.5 mm thick, weighs 3.75 grams, and is made of 60 to 70% copper and 30 to 40% zinc with a smooth edge along with an image of Ear of Rice, gear, water and value printed on the obverse while the value and year of minting printed on the reverse. ¥10 is 23.5 mm in diameter and 1.5 mm thick, weighs 4.5 grams, and is made of 95% copper, 3 to 4% zinc, and 1 to 2% tin with either usually a smooth edge along with an image of the Hōōdō Temple, Byōdō-in, state title, and value printed on the obverse while an image of the Evergreen tree, value, and year of minting printed on the reverse. ¥50 is 21 mm in diameter and 1.7 mm thick, weighs 4 grams, and is made of Cupronickel (75% copper and 25% nickel) with a reeded edge along with an image of chrysanthemum, state title, and value printed on the obverse while the value and year of minting printed on the reverse. ¥100 is 22.6 mm in diameter and 1.7 mm thick, weighs 4.8 grams, and is made of Cupronickel (75% copper and 25% nickel) with a reeded edge along with the image of cherry blossoms, state title, and value printed on the obverse while the value and year of minting printed on the reverse. Las but not the least, ¥500 is 26.5 mm in diameter and 2 mm thick, weighs 7 grams, and is made of 72% copper, 20% zinc, and 8% nickel with a slanted, reeded edge along with the image of paulownia, state title, and value printed on the obverse while an image of bamboo, mandarin orange, the value, and year of minting printed on the reverse. Both the ¥5 and ¥50 have holes in the middle while the ¥1, ¥10, ¥100, and ¥500 are whole. Fun fact regarding coins is that the first commemorative coin was minted in the year 1964, the Tokyo Olympic prize coin, with two values: 100 yen and 1,000 yen.

Another part of the Japanese yen currency system is a number of banknotes. First introduced in the year 1872, banknotes still exist and are used up to this day. The denominations of Japanese banknotes have changed and ranged from 0.05 yen up to 10,000 yen. Many organizations have issued banknotes dating back to the 1800s with the Imperial Japanese National Bank, the Allies, and the Bank of Japan among them. Throughout history, the Japanese yen banknotes have undergone a number of series, changing the characters and the values of these notes. The first series of letters as a code was created and used in the year 1946 called Series A. Series A consisted of ¥0.05, ¥0.1, ¥1, ¥5, ¥10, and ¥100. Only the ¥1 and the ¥100 had a character printed on the obverse with Ninomiya Sontoku for the ¥1 and Price Shōtoku for the ¥100.

A higher value of ¥1000 was introduced in Series B in the year 1950 with other values of ¥50, ¥100, and ¥500, all with human characters in them. Later on, in the year 1957, two higher value banknotes were again introduced; this series consisted of ¥500, ¥1000, ¥5000, and ¥10,000. A new series was then introduced in the year 1984 called Series D, with only 3 banknotes, namely, ¥1000, ¥5000, and ¥10,000. However, upon discovery of a huge number of counterfeit banknotes from this series, they have been suspended on Jan. 17, 2005. To commemorate the 26th G8 summit in Okinawa and the 2000 millennium year, the Commemorative Series D was issued in the year 2000 with the banknote of ¥2000, which is considered rare in the market. The latest series is Series E, which was issued in the year 2004. This series consists of ¥1000, ¥5000, and ¥10,000, all with human characters in them.

Costs in Japan: Convert from Japanese Yen (JPY) to U.S. Dollars (USD)

Now there is only one way to utilize the Japanese yen and that is, of course, to spend them! If one is opting to visit Japan, then it is best to learn about their currency, as Japanese yen is the only currency that most stores and establishments in the country recognize and accept. Many may assume that it is expensive to live in Japan, even for just a few days, because of misconceptions about how high their banknotes are. To give you a brief idea on how much things actually cost in Japan, there will be a Japanese yen – U.S. dollars conversion to gauge if it really is that expensive to live in Japan.

While there are definitely expensive meals and accommodations in Japan if one is looking for fine dining and luxury hotels, there are definitely cheaper alternatives that one can opt for without compromising the quality or the experience. The Japanese people are all about the best output or results that they can offer, after all. For food, a bowl of soba or udon noodles cost only about ¥200 to ¥700 yen, which is roughly only around $2 to $7. If snacks are what one is looking for, then a rice ball called onigiri or pastries from a bakery can be bought for only ¥150 to ¥200, which is only about $1.50 to 2. They are pretty affordable, right? If it is raining and there is a craving for that hot bowl of ramen, one can find several ramen joints that offer a bowl for only ¥700 to ¥1000, which converts to about $7 to $10 only. A whole lunch set or a teishoku costs around ¥800 to ¥1200, which is about 8 to 12 dollars. For drinks, teas are generally free in several restaurants while a bottled water can cost about ¥120 or $1.20. A draft beer or a glass of sake can cost about ¥400 to ¥600, which converts to roughly $4 to $6 only. As for travel, their transportation system is very efficient and reasonably priced. One can opt for a subway ride in Tokyo, which will only cost about ¥200 or $2. Bicycle rentals are also available for only about ¥1000 to ¥1500 per day, which converts to only about $10 to $15. For those wishing to look around and explore, there are many temples and shrines in the country that are free of entrance. Museums may sell entrance tickets, but these would cost only about ¥1000 to ¥2000, which is roughly about $10 to $20 only. On a side note, there is no need to worry about the additional cost of tipping, as it is customary in Japan.

Exchange rates from Japanese yen to U.S. dollars changes on a daily basis, depending on the global and foreign exchange market. Currently, around ¥120 to ¥150 is equivalent to US$1. Before traveling to Japan, it is best to be prepared and to carry a certain amount of Japanese yen just in case there are no money exchange establishments open upon arrival in the Land of the Sun.