Which British event in 1992 caused the pound to leave the European Exchange Rate Mechanism?

Black Wednesday caused the pound to leave the European Exchange Rate Mechanism on September 16, 1992.

Britain had joined the ERM in October 1990, committing to keep the pound within an agreed band against other European currencies. In 1992, investors doubted that Britain could maintain the pound’s exchange rate while facing recession, high interest rates, and pressure from currency markets.

The British government raised interest rates and announced further measures to defend sterling, but the pressure continued. On September 16, it suspended the pound’s ERM membership. The day became known as Black Wednesday and was a major political setback for Prime Minister John Major’s government.

Black Wednesday was primarily a currency crisis, although it affected financial markets and is often included in accounts of major market crashes. It is not the same event as Black Monday in 1987 or Black Tuesday in 1929. The key outcome was Britain’s withdrawal from the ERM, not a stock-exchange closure.