Blocked Currency(redirected from Nonconvertible Currency)
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Related to Nonconvertible Currency: Blocked currency, Freely Convertible Currency
currency moved to a foreign bank, whose free disposal by the owner is prohibited by the governmental organs of the blocking country. In periods of war currency of the hostile country is usually blocked.
During and after World War II (1939–45), the blocking of currency was employed as a weapon of economic and political pressure. Thus, in the war years, when England imported goods from countries of the sterling bloc without paying for them, large sums of debts due to the supplier countries—the so-called blocked sterling bank deposits abroad—went into the blocked accounts in London banks. (On June 30,1945 the sum was £3,335 million.) As a rule, the blocked currencies cause a series of conditions which are burdensome for the creditor countries.