In British politics and economics, Black Wednesday refers to September 16 1992 when the government was forced to withdraw the Pound from the European Exchange Rate Mechanism (ERM) by currency speculators - most notably George Soros who earned over $1 billion in doing so. The event is estimated to have cost the people of Britain £4 billion in reserves, spent trying to prop up the pound.
When the ERM had been set up in 1979 Britain declined to join. This was controversial, as the Chancellor of the Exchequer Geoffrey Howe, despite his economically 'dry' credentials, was a convinced pro-European. Another chancellor, Nigel Lawson, was also a believer in a fixed exchange rate, and although he was a mild Eurosceptic he admired the low inflationary record of Germany, attributing it to the strength of the Deutsche Mark and the management of the Bundesbank. The Treasury followed a semi-official policy of