convertible currency


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Convertible Currency

A currency that may be exchanged for a foreign currency. Currency convertibility is vitally important in the foreign exchange market; higher convertibility means that a currency is more liquid and, therefore, less difficult to trade. Factors affecting convertibility include the availability of foreign currency reserves in a given country and domestic regulations seeking to protect local investors from bad investment decisions in, for example, a currency undergoing a period of hyperinflation. A few socialist governments even issue inconvertible currencies, such as the Cuban peso, in order to protect their citizens from perceived capitalist infiltration. See also: Inconvertibility.

convertible currency

a currency which can be converted into another currency without special permission from the FOREIGN EXCHANGE CONTROL authorities.
References in periodicals archive ?
Several Havana residents interviewed by this journalist have many doubts about holding on to savings in CUPs because of their uncertainty as to what the fixed parity between the Cuban peso and the convertible currency will be on Day Zero.
Repatriation of revenues and profits outside of Jordan, in a convertible currency, earned by virtue of the investment;
Two, India's unwillingness to make the rupee a fully convertible currency also means it must use a mutually acceptable currency.
Bahrain has a more liberal economy, it's competitive, value-oriented, has the lowest tax, 100pc ownership in business and real estate and has a freely convertible currency.
Tunisia plans to ease some restrictions on the movement of capital in preparation for a planned switch to a fully convertible currency in 2014.
Mayaleh's next big effort is to complete the liberalisation of the current account and move to a fully convertible currency exchange system.
an advantage: it had the only convertible currency, and so could issue domestic currency to pay its import bills.
00 or its equivalent in a convertible currency and an account will be opened for this purpose for deposit of tourists expenses.
China is said not to have a convertible currency and lack transparency in economic system.
The amount to be invested by a foreign investor is at least $500,000 or the equivalent in any freely convertible currency deposited in the Bank of South Sudan," reads the Act.
Cuba introduced the convertible currency in 1994 when Cubans started receiving remittances from relatives in Florida to help them weather an economic crisis triggered by the break-up of Havana's benefactor, the Soviet Union.