1976 sterling crisis

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The 1976 sterling crisis was a currency crisis in the United Kingdom. Inflation (at close to 25% in 1975, causing high bond yields and borrowing costs), a balance-of-payments deficit, a public-spending deficit, and the 1973 oil crisis were contributors. The origins of the crisis have been attributed to the 1972 Conservative "dash for growth" budget initiating the inflation cycle. James Callaghan's Labour government had to borrow $3.9 billion (equivalent to $22.1 billion in 2025 dollars) from the International Monetary Fund (IMF), while implementing significant spending cuts, with the intention of maintaining the exchange rate of sterling. At the time this was the largest loan ever to have been requested from the IMF.

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