The 1992 market crisis when the United Kingdom withdrew the pound from the European Exchange Rate Mechanism was called Black Wednesday.
Black Wednesday occurred on 16 September 1992. The British government had joined the ERM, which required the pound to remain within an agreed band against other European currencies. Speculators sold pounds heavily, arguing that the exchange-rate target was unsustainable.
The government raised interest rates and spent billions of pounds defending the currency, but the pressure continued. Chancellor Norman Lamont announced the United Kingdom’s withdrawal from the ERM later that day. The pound subsequently fell, while the episode became a major political embarrassment for the Conservative government.
Black Wednesday is sometimes confused with Black Monday, the label most famously associated with the worldwide stock-market crash of October 1987. The two events occurred five years apart and had different immediate causes.