FirstFT: Mario Draghi offers to stand down

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Italy was plunged into political turmoil yesterday when Prime Minister Mario Draghi offered to resign over a split in his national unity government.

The former European Central Bank president said the conditions were no longer in place for him to carry on after the populist Five Star Movement refused to support his government in a critical parliamentary vote.

“The majority of national unity that had supported this government since its creation is no longer there,” Draghi said in a statement.

His resignation was quickly rejected by Italy’s president Sergio Mattarella, who asked Draghi to address parliament next week to assess support for his government.

Italian politicians will try to patch together a compromise to prevent the country from being tipped into early elections. But doubts are growing over the longevity of the broad coalition Draghi has led since early 2021.

Thanks for reading FirstFT Europe/Africa. Here is the rest of the day’s news — Jennifer

1. Accounting firms ordered to outline exam cheating safeguards The UK accounting watchdog has ordered the biggest audit firms to explain how they prevent staff cheating on professional exams after regulators clamped down on the practice following scandals in the US, Canada and Australia.

2. Sunak and Mordaunt gain ground Rishi Sunak yesterday secured 101 votes in the second ballot of Conservative MPs, leaving him 19 short of the 120 required to reach the final two-person shortlist of the Tory leadership contest, while rivals including Liz Truss scrambled to stop the momentum behind second-place Penny Mordaunt. Follow the race with our tracker.

The five remaining candidates: Kemi Badenoch, Penny Mordaunt, Rishi Sunak, Tom Tugendhat and Liz Truss © FT montage: Getty Images/Reuters

3. Celsius Network reveals $1.2bn shortfall in bankruptcy filing The crypto lender has disclosed a $1.2bn hole in its balance sheet caused by what chief executive Alex Mashinsky called “poor” investments and other “unanticipated” losses. Premium subscribers can sign up to our new cryptocurrency email to help guide you through the crash.

4. Amazon plans 4,000 more UK jobs The US ecommerce giant will create more permanent jobs to become one of Britain’s top employers, despite fears that rising inflation will hit consumer demand and a sharp slowdown in overall revenue growth for the global group.

5. Kyiv dismisses fears of weapons smuggling Ukraine’s government has pushed back against concerns that the country could become a source of smuggled weapons but acknowledged the need to expand arms tracking systems. “We need to survive. We have no reason to smuggle arms out of Ukraine,” defence minister Oleksii Reznikov told the Financial Times.

  • Oil: Prices fell below $95 a barrel for the first time during the war as fears of a global recession gripped commodity markets.

  • Opinion: Vladimir Putin’s stamina for war will test the west’s resolve, writes Lionel Barber.

The days ahead

Tory leadership televised debate The five remaining candidates will participate in their first televised debate today, before a second on Sunday. A third round of voting among MPs will take place on Monday.

UK university strike A ballot for industrial action closes for University and College Union members in a dispute over low pay, unmanageable workloads and professional respect.

Biden in Saudi Arabia Joe Biden will arrive in the Gulf state with a two-pronged plan to bring down oil prices: first, convince Riyadh to pump more oil to Europe; and second, cap the price at which Russia can sell its crude.

US bank earnings Results are out from Citigroup, Wells Fargo and Bank of New York Mellon as well as BlackRock. JPMorgan Chase and Morgan Stanley yesterday reported bigger-than-expected declines in second-quarter profits, signalling the end of the pandemic earnings boom.

Economic data June consumer price index figures are out for Italy and Poland, as is EU goods trade data for May. Economists forecast a rise in US retail spending in June following a decline the previous month and slower growth in industrial production.

Donald Trump and children testify The former US president and two of his adult children have agreed to testify in a New York state civil investigation into his business practices starting today.

UK brewers strike Workers at Budweiser Brewing Group’s Lancashire site, which brews Budweiser, Stella Artois, Becks, Boddingtons and Export Pale Ale, begin a 36-hour strike tomorrow over pay.

Join FT journalists today at 1pm BST for a virtual briefing for subscribers on what awaits Britain and business after Boris Johnson, as rival Conservative candidates battle to succeed him as prime minister. Register for free.

What else we’re reading

Is Britain tiring of the culture wars? Brexit was supposed to have left the country bitterly divided. But social media is no longer full of simplistic stances on identity, and Boris Johnson’s attempts to recapture the zeitgeist of identity politics could not save his premiership. Henry Mance finds culture battles are losing their grip on the national conversation.

A riskier approach to vaccines will pay off At the risk of sounding like a newly-wed presenting their spouse with a list of pointers for improvement, Tim Harford writes that Covid vaccines, while miraculous, could do better. The virus has adapted so quickly that it is at risk of leaving us behind.

Britons won’t think heatwaves are fun for much longer The country’s longstanding love affair with warm weather is understandable. The climate is notoriously grey and damp, and heatwaves of the past rarely exceeded 30C. But the conditions of hot spells have changed, writes John Burn-Murdoch, and too few realise where they are headed.

US recession is less of a danger than long-term inflation As the weeks go by, the case gets stronger for consumers and investors to buckle up and brace for a bumpier impact as policymakers try to get the economy back to robust growth. The FT View is that the Federal Reserve needs to hold its nerve on tightening policy.

Ben and Jerry’s lessons for aspiring PMs Conservative hopefuls and ice cream makers alike are trying to capture the attention of people that might like them, without irredeemably alienating too many others. The Vermont company’s ability to mix folksy fun, campaigning controversy and the cold realities of capitalism offers lessons to UK politics, writes Helen Thomas.

Art books

Looking to put yourself in a holiday mood? From Mediterranean escapes to Campari spritzes, here are seven art books to celebrate the summer.

Swimming pool designed by Alain Capeillères, Le Brusc, 1976
Swimming pool designed by Alain Capeillères, Le Brusc, 1976 © Martine Franck/Magnum Photos

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