What currency was at the center of the 1992 Black Wednesday crisis?

British pound sterling was at the center of the 1992 Black Wednesday crisis.

On September 16, 1992, the United Kingdom withdrew the pound from the European Exchange Rate Mechanism, or ERM. The government had tried to keep sterling within an agreed band against other European currencies, but selling pressure made that policy increasingly difficult and expensive to defend.

The crisis followed speculative attacks and disagreements over interest rates, inflation, and the appropriate exchange-rate level. The government raised interest rates twice on Black Wednesday, including an announced move to 15 percent, but ultimately suspended the pound’s ERM membership.

The episode damaged the governing Conservative Party’s reputation for economic competence, although the later fall in sterling helped Britain’s economy recover from recession. Black Wednesday is sometimes called the day Britain was forced out of the ERM, but the pound’s withdrawal was a policy decision made after the defense of its exchange rate failed.