Wednesday, September 16, 1992, the day the British government withdrew the British pound from the Exchange Rate Mechanism (ERM), a European monetary agreement. The value of the pound was quickly declining and the ERM required it to remain within a price range. The British government tried to stop the price slide by purchasing sterling in the market. However, the government spent a significant amount of money and was not going to be able to continue its buying campaign. Instead, it decided to stop buying the pound, and thus had to withdraw from the ERM because the pound would no longer be in the prescribed trading range.