Crypto News: Sunak makes his move

Welcome to The Readout, the new daily newsletter from Bloomberg UK.

The Tory party leadership election kicked into full gear today, with former Chancellor Rishi Sunak the first big-hitter to join the race. Critically, he announced the endorsement of former Chief Whip Mark Spencer, widely liked across the party. Kitty Donaldson has this smart rundown on who has a real chance.

Shortly beforehand, Labour leader Keir Starmer was cleared of breaking lockdown rules, vindicated in the biggest strategic gamble of his leadership.

When Durham Police began a probe into "Beergate" and Starmer pledged to resign if fined, he can't have known that he'd be cleared 24 hours after the other guy quit. It leaves the summer clear for Starmer to set the political tone against Boris Johnson, now a lame-duck prime minister.

Can Starmer silence critics who say he doesn't have the ideas to set the agenda?

Keir Starmer smiled as he spoke to the media on Friday. Photographer: Dan Kitwood/Getty Images Europe

Were you forwarded this email? You can sign up here.

The stories you need to know about this evening

Johnson asked his new chancellor to cut taxes. Nadhim Zahawi refused.
Business chiefs warned Tory leadership hopefuls against tax cuts.
An ex-employee accused crypto lender Celsius of being a "ponzi scheme".

When Boris Johnson eventually leaves the stage, the fourth Conservative prime minister in seven years will stand on the steps of No. 10 buffeted by the fiercest headwinds in 50.

It's a sobering prospect. "When the battle for his crown is over, will the victor do any better?" Martin Ivens asks today for Bloomberg Opinion.

The inbox will be full. Within weeks of them taking office, voters will howl as the energy-price cap is raised, pushing bills up; the government will need to box clever to secure the nation's energy supplies; and persistently high fuel prices will make people furious and fractious.

As Tory leadership candidates try to chart a course to victory in the coming weeks, Bank of England Governor Andrew Bailey will try to tread his own "narrow path" — and the two will collide.

Undercook interest rates this August and Bailey risks accusations of letting inflation rip. We are already in the longest-ever run of declines of household earnings. Public sector workers want inflation-busting pay-rises. Strikes will shadow leadership hustings.

But hiking rates too much might well induce a recession, making the autumn harder in a different way. Unemployment is historically low and there are many job vacancies, but it could tip quickly.

NHS waiting lists climb in any normal autumn, but this will be compounded by the Covid backlog. Patience will run thin. The 2019 election suggested an electorate already tired of austerity in public services (hence this election pledge) even before the pandemic.

How to stop sterling's slide? Can the UK-EU dispute over Northern Ireland be resolved? And can any new PM play better with the Scots? If a trade war and a Scottish referendum can be avoided, investor confidence in the UK will surely increase.

Ukraine will continue to need British support. Extreme global weather will be felt in the UK. It's a lot.

Bloomberg Opinion's Adrian Wooldridge isn't convinced the contest to come will necessarily meet the moment:

"The coming leadership election will be much more like a scrum than a rational quest for the best person to run a country confronted by such formidable and mounting problems."

Ready for a holiday yet?

Artificial turf in the front yard of a home in Henderson, Nevada. Photographer: Bridget Bennett/Bloomberg

The lawn—or what we traditionally view as one—is dying. Homeowners around the world are swapping real grass for artificial turf as climate change forever alters what a normal garden looks and smells like. It's one of the ugly realities facing gardeners as global warming hits suburbia. For those already living at the extremes, the hum of a lawnmower on a Saturday morning or the smell of freshly cut grass are on the way to becoming a distant memory.

Get ahead of the curve

Can markets forget? UK stock indexes will be glad to move on from Boris Johnson's time in office.

Hot weather can kill. From South Asia to Europe, intense heat is pushing our bodies beyond the bounds of physiological tolerance.

How to be an autocrat. Today's dictators mostly avoid brutality — instead they wrap themselves in spin and lean on misinformation.

Small country, big idea. Residents of Luxembourg get free travel on trains and buses. Does it work?

Where to eat outside. Thirteen of the best places in London for outdoor dining during this unusually warm summer.

What billionaires can't do. A company building a huge yacht for Jeff Bezos won't ask for a historic Dutch bridge to be dismantled.

Hangovers are 'wellness' now. At a resort in Mexico, the "hangover cure" is what matters most.

"Matters of profit and loss pale in comparison with matters of life and death.

John Authers

Our columnist on trying to write about markets on the day that former Japanese Prime Minister Shinzo Abe was shot and killed.

One key story, every weekday

Protesters march towards the Presidential Palace during a demonstration over soaring living costs in Accra, Ghana, on June 29 Photographer: Nipah Dennis/AFP

A quarter-trillion dollar pile of distressed debt is threatening to drag the developing world into a historic cascade of defaults. Sri Lanka was the first nation to stop paying its foreign bondholders this year, burdened by unwieldy food and fuel costs that stoked protests and political chaos. Russia followed in June after getting caught in a web of sanctions.

Now, focus is turning to El Salvador, Ghana, Egypt, Tunisia and Pakistan. "With the low-income countries, debt risks and debt crises are not hypothetical," World Bank Chief Economist Carmen Reinhart said on Bloomberg Television. "We're pretty much already there."

Read The Big Take.

Your early warning system

Monday
Barristers start four-day strike over legal aid fees dispute.
Crown Post Office strike
Network Rail strike ballot closes for 6,000 staff

Heathrow Airport monthly traffic figures

10 a.m. National Grid AGM

Follow all Monday's early news in The London Rush, live on Bloomberg UK from 8 a.m.

Please send thoughts, tips and feedback to readout@bloomberg.net. You can follow Allegra on Twitter. The Readout is edited by Adam Blenford.