The name given to the 1992 currency crisis that forced the UK out of the European Exchange Rate Mechanism was Black Wednesday.
The crisis occurred on 16 September 1992, when the British government could no longer keep the pound above the ERM’s permitted lower exchange-rate limit. The government spent billions of pounds buying sterling and raised interest rates from 10% to 12%, even briefly promising 15%, but traders continued selling the currency.
Britain had joined the ERM in 1990, linking sterling’s value to other European currencies. Pressure intensified after German reunification contributed to high German interest rates, making it harder for the UK to defend the pound. The government eventually announced its withdrawal that evening.
Black Wednesday is often confused with Black Monday, the 1987 global stock-market crash, or with Black Friday and Black Tuesday. Some supporters later called it “White Wednesday” because leaving the ERM was followed by an economic recovery and the adoption of inflation targeting.