The Trade of the Century: When George Soros Broke the British Pound. Rohin Dhar. priceonomics.com . Jun 17, 2016. Before the EU, Europe had the ERM to fix their exchange rates with the Deutschmark within 6% of the agreed upon rate.
Keeping the exchange rate fixed requires governments to nudge the rate, e.g.
Use reserves of foreign currency to buy up their own currency Set high interest rates to entice lenders to buy their currency Margaret Thatcher (PM) opposed the fixed exchange rates but lost the vote to Major, an ERM proponent....