The Singapore dollar reached a new record high against the Japanese yen on Wednesday, 22 July 2026, with S$1 buying about ¥126.3 on the foreign exchange market.
That is good news for Singaporeans planning a Japan holiday, as accommodation, food, shopping and transport priced in yen have effectively become cheaper.
However, the exchange rates offered by banks, cards and money changers will usually differ from the headline market rate.
The Singdollar Has Broken Its Previous Record
The latest milestone came just weeks after the yen had already fallen to record lows against the Singapore dollar.
On 1 July, S$1 briefly bought more than ¥125.7, which was an all-time high at the time.
The exchange rate has since crossed ¥126, reaching approximately ¥126.3 on 22 July.
For comparison, S$1 bought about ¥121.93 on 1 January 2026. This means the Singapore dollar has strengthened by approximately 3.6 per cent against the yen since the start of the year.
The difference becomes more obvious when larger amounts are converted.
At the current rate, S$1,000 would get you approximately ¥126,300. At the start of 2026, the same S$1,000 would have provided about ¥121,930.
That is a difference of approximately ¥4,370.
Similarly, something in Japan costing ¥100,000 would theoretically cost around S$792 at the latest rate, compared with about S$820 at the start of the year.
That is a saving of approximately S$28 before any transaction fees or exchange-rate spreads are included.
Why the Japanese Yen Is So Weak
The latest record is largely a story of yen weakness, rather than the Singapore dollar suddenly becoming much stronger against every currency.
On 21 July, the yen weakened to 163.24 against the US dollar, its lowest level since late 1986.
One major reason is the gap between interest rates in Japan and other major economies.
The Bank of Japan raised its benchmark interest rate to 1 per cent in June 2026, its highest level in 31 years. However, Japanese interest rates remain considerably lower than those in the United States.
Higher interest rates can make a currency more attractive to investors because financial assets denominated in that currency may provide better returns.
The yen has also been affected by concerns over Japan’s government finances and whether political pressure could slow further interest-rate increases by the Bank of Japan.
Meanwhile, higher oil prices and US Treasury yields have strengthened demand for the US dollar while adding further pressure on the yen.
Japan relies heavily on imported energy, so a weaker yen and higher oil prices make its imports more expensive.
Japan’s imports rose 25.4 per cent from a year earlier to a record ¥11.3 trillion in June 2026. The increase was driven largely by crude oil prices and the weak currency.
The Singapore Dollar Has Remained Relatively Strong
The Singapore dollar has also been supported by the Monetary Authority of Singapore’s monetary policy.
Unlike most central banks, MAS does not primarily control inflation by setting an interest rate.
Instead, it manages the Singapore dollar against a basket of currencies belonging to Singapore’s major trading partners. The currency is allowed to move within an undisclosed policy band.
In April 2026, MAS announced that it would allow the Singapore dollar to appreciate slightly faster to help reduce the effect of rising imported prices.
Singapore’s economic and political stability has also helped the currency behave like a safe-haven asset during periods of global uncertainty.
However, the Singdollar has not strengthened as dramatically against the US dollar. On 22 July, one US dollar was worth approximately S$1.2916.
The record against the yen is therefore being caused by a relatively resilient Singapore dollar meeting an exceptionally weak Japanese currency.
Japan Could Still Intervene to Strengthen the Yen
The favourable exchange rate may not last forever.
Japanese Finance Minister Satsuki Katayama said on 22 July that the government was prepared to take decisive action in the currency market if necessary.
Japan had already spent a record ¥11.7 trillion between late April and early May to support the yen after it weakened beyond 160 against the US dollar.
The intervention temporarily strengthened the currency, but the gains were eventually erased.
Analysts told Reuters that future intervention may again strengthen the yen temporarily. However, a lasting recovery may require higher Japanese interest rates, lower US interest rates or improved confidence in Japan’s fiscal policies.
In other words, Singaporeans heading to Japan currently have one of the most favourable exchange rates ever recorded, but foreign exchange markets can change quickly.
