The United Kingdom experienced the 1992 Black Wednesday crisis after defending the pound within the European Exchange Rate Mechanism.
On September 16, 1992, the British government and Bank of England raised interest rates and bought pounds to keep sterling inside its ERM exchange-rate band. Speculators, including George Soros's Quantum Fund, continued betting that the pound would be devalued or removed from the mechanism.
The government eventually suspended sterling's ERM membership and allowed the currency to float. The episode became known as Black Wednesday. Britain did not formally join the euro, and the experience influenced later British skepticism about adopting the single currency.
Black Wednesday was primarily a currency and monetary crisis rather than a stock-market crash, but it caused major financial-market losses and political damage. A common mix-up is to identify it as a French or Italian event; Italy also left the ERM temporarily during the turmoil, but the famous nickname refers to the United Kingdom's pound crisis.