Nonconvertible Currency
Any currency that is used primarily for domestic transactions and is not openly traded on a forex market. This usually is a result of government restrictions, which prevent it from being exchanged for foreign currencies.
Also known as a "blocked currency". Investopedia Says:
As the name implies, it is virtually impossible to convert a nonconvertible currency into other legal tender, except in limited amounts on the black market. When a nation's currency is nonconvertible it tends to limit the country's participation in international trade as well as distort its balance of trade. Related Terms:
Balance Of Trade - BOT
Black Market
Blocked Currency
Currency
Exchange Control
Exchange Rate
Foreign Currency Effects
Foreign-Exchange Risk
Forex - FX
Repatriation |