A high exchange rate does not necessarily indicate a strong currency. The relative strength of a currency is seen over a long period of time. Changes are determined by supply and demand, as well as inflation and interest rates, among other things. Over a long period of time the British pound has become weaker as the British Empire has waned, yet the pound remains a stronger currency than the US dollar. And even though 1 yen is worth a little less than 1 US penny, over the long-term the yen has been consistently strengthening against the US dollar, going from an exchange rate of 300 yen to 1 USD in the early 1970s to the current exchange rate of just over 100 yen to 1 USD.