The inner code block is surrounded by { } but it doesn't follow
a conditional statement, or function name.

Does anyone know whether the program will move from the outer code block
into the inner code block and then out again back to the outer
code block?
You can use as many braces as you want. The compiler will not generate errors, it is valid:

Code:
#include <stdio.h>
int main ( void )
{
    int x;
    printf("x is visible\n");
    {
        int y;
        printf("x and y are visible\n");
        {
            int z;
            print("x, y and z are visible\n");
        }
        printf("x and y are visible\n");        
    }
    printf("x is visible\n");
    return 0;
}
Note that you can include additional variables with a limited scope this way.

Quzah.