Keynes's preoccupations with How to Pay for the War did not prevent him from taking a continuing interest in other aspects of wartime economic policy, in particular exchange control.

At the outbreak of war, the exchange control set up by the British authorities allowed non-residents to dispose of their sterling balances and securities on a separate market not subject to exchange control or official support. It also permitted British exporters to invoice their sales in sterling. As long as this regime continued, non-residents could reduce their sterling assets through free (or black) market sales of foreign exchange to other non-residents who might use the proceeds to purchase British exports. In these circumstances, the exports added nothing to Britain's capacity to purchase goods abroad. Attempts to remove this gap came slowly, but the first, requiring hard currency invoicing of exports of tin, rubber, jute, whisky and furs from the sterling area in March 1940 reduced the usefulness of non-resident sterling and, hence, the demand for it.

Initially, Keynes had unsuccessfully raised the matter of exchange control evasion through transactions in outstanding securities in a letter to Sir Frederick Phillips on 22 February, after a Treasury order requisitioning American securities led to offers of large blocks of BATs (British American Tobacco) shares from America. On 4 March, he promised Phillips a memorandum on the whole problem of exchange control as soon as he was ‘less preoccupied in other directions’, while the next day he lunched with the Governor of the Bank of England and doubtless discussed the matter. […]