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When will the U.K. convert to the Euro as an official currency?
I read an account of why the U.K. didn't end up with the euro as its currency in David M. Smick's great book The World Is Curved: Hidden Dangers to the Global Economy. Chapter 6 of the book is titled "Nothing Stays the Same: The 1992 Sterling Crisis."  Here's a very brief excerpt; emphasis mine: [...] As this story shows, such   blindness to the realities of a   changing world can be very dangerous.   In this case, the result was the   brutal collapse of the British pound,   which explains why the British people still use their own currency, the   pound or sterling, and not the euro.   The events that unfolded in the autumn   of 1992 were totally unforeseen, yet   they reshaped the European monetary   world and represent a phenomenon that   continues to impact global economies. [...] Smick's account of the events around 1992 runs about 28 pages.  Here's my version, in a nutshell: At the time, Britain was part of the European Exchange Rate Mechanism, or ERM. The belief in Europe was that by uniting currencies under a common mechanism, Europe could gain influence in international financial policy largely dominated by the United States.  The ERM was a precursor to monetary union.  The Maastricht Treaty would eventually create the European Union and the euro. Britain joined the ERM later than other nations, in 1990, and after some controversy. Being part of the ERM required member nations to agree to expand and contract their currencies only within certain agreed upon limits called currency bands. Due to the way this had been structured, Germany's strong position placed it at the top of the system. At some point in 1992, Germany had raised interest rates to curb future inflation.  However, Britain wanted Germany to cut rates – Britain was not in as enviable a position, economically speaking, and its currency was under pressure.  The currency band system would put Britain in a tighter spot with Germany raising rates. Enter George Soros, the Hungarian billionaire, a.k.a. "the man who broke the Bank of England."  Soros took a huge short position against the Sterling. He believed the Sterling was overvalued relative to the German deutsche mark, and Britain would be forced to devalue its currency and realign with respect to the ERM.  Other traders followed and also sold the Sterling short. With much pressure on the currency, the Bank of England had to buy up Sterling in order to maintain its agreement under the ERM.  Of course, they needed to borrow other currencies to do this.  Soon the BoE was in over its head defending the Sterling, realizing the exchange rate it needed to maintain under the ERM simply wasn't sustainable. Britain was forced to withdraw from the ERM on Black Wednesday, September 16th, 1992. And so, Britain does not use the euro today – and any talk of doing so is politically controversial.  Therefore I wouldn't bet on Britain adopting the euro any time soon – too many of the players are still in politics and remember 1992 well.  I think if Britain adopting the euro is ever to happen, it will be when the memory of 1992 has faded away. BTW, George Soros made off with more than US$1 billion.  Soros is a very smart guy.