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The Bank of England is preparing to unleash another round of monetary stimulus as it battles to contain the economic fallout of the UK’s decision to leave the EU.

Given a deteriorated economic outlook, governor Mark Carney said the bank could “be expected to take whatever action is needed to support growth”, as long as inflation was projected to return to target.

Meanwhile, Britain’s political upheaval took an extraordinary turn on Thursday after former frontrunner Boris Johnson pulled out of the race to be the next UK prime minister.

Mr Johnson and former ally Michael Gove had been a powerful duo at the head of the campaign to take Britain out of the EU. But the decision by Mr Gove to launch a rival bid for the leadership of the Conservative party had undermined Mr Johnson’s ticket.

In preparation for its exit from the EU, the UK plans to launch high-level trade missions to China, India, the US and the Commonwealth. Prime minister David Cameron told business leaders it was imperative for corporate Britain not to become “fixed” on the EU, but to instead make advances beyond the bloc.

After an initial shock, the FTSE 100 has all but recovered to pre-Brexit levels. More broadly, companies with overseas earnings or in haven sectors have benefited most, while others have announced job cuts and profit warnings.

Find our full coverage of the aftermath of Brexit here and in our daily Brussels Briefing. You can follow by-the-minute updates on our live blog.

In the news

Deutsche Bank hit by IMF hazard warning A report has branded the German lender as the riskiest globally significant bank on the back of its failure to pass another US Federal Reserve stress test. Meanwhile US banks have dished out $96bn to shareholders after the tests. (FT)

Hershey rejects $23bn bid from Mondelez The approach comes as Mondelez looks to capitalise on the value of its stock and the Hershey Trust is in a period of turbulence. (FT)

Turkey identifies nationalities of Ataturk bombers The three suicide bombers who killed 43 people and wounded 238 others were from Russia, Uzbekistan and Kyrgyzstan. (NYT)

China to tolerate weaker currency China’s central bank would allow the renminbi to fall as low as 6.8 per dollar this year to support its economy. (Reuters)

Australia set for 25 years of growth The country has notched up a quarter-century without a recession, a record that has pushed living standards to among the highest in the world (FT)

It's a big day for

Puerto Rico President Barack Obama is expected to sign legislation on Friday to prevent the US territory from possibly defaulting on $2bn worth of debt payments. The emergency legislation will help Puerto Rico restructure it $70bn debt load and halt all new litigation. (FT)

Food for thought

Shareholder activism The stand-off at property group China Vanke has parallels with early US boardroom bouts. Where there is shareholder capitalism, there is bound to be shareholder activism, writes Andrew Hill (FT)

Meet art prodigy Autumn de Forest The 14-year-old has sold $7m of paintings after her father discovered her talent when she was five. Now they’re keen to develop the brand. (FT)

Viacom succession battle Other media companies like Fox, Disney and the New York Times would do well to look at the Viacom mess and think about their own plans, writes Matthew Garrahan. (FT)

Fallujah’s pivotal moment In the absence of political process, the victory in recapturing the Iraqi city could yet prove pyrrhic (FT)

Markets spotlight After the UK referendum on the EU, the FT has written extensively on the twists and turns seen across currencies, bonds, shares and commodities. Here’s an updated selection of analysis for readers to review. (FT)

Video of the day

Hong Kong trams The elderly network of “Ding Dings” carried 500,000 people a day in the 1960s, but that has dwindled to only 185,000 today as Hong Kong’s ever improving metro system and plethora of buses tempt passengers away. (FT)

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