Britain's economy remained below its pre-pandemic peak, according to data published on Friday that left the country further adrift of other Group of Seven nations and underscored the challenge facing new Prime Minister Liz Truss.

This week's plunge in UK financial assets accelerated a longer historic decline signalling a loss of confidence among international investors that Britain may find hard to restore.

Lower fuel prices caused an unexpected fall in British inflation in August, official figures showed on Wednesday, offering some respite to households and the Bank of England after inflation hit a 40-year high the month before.

Britain's jobless rate hit its lowest since 1974 but the drop was due mostly to a fall in the size of the workforce and there were other signs that the country's jobs boom is petering out, adding to the Bank of England's inflation headache.

British gross domestic product expanded 0.2 percent after a drop of 0.6 percent in June, the Office for National Statistics said in a statement.

Even though fears of another "sterling crisis" have been wide of the mark for decades, they are harder to bat away this time around as a fourth British prime minister in six years takes the helm.

New British Prime Minister Liz Truss and her finance minister Kwasi Kwarteng look set to revive Margaret Thatcher's 1980s experiment in "trickle-down" low-tax economics, the results of which have been disputed ever since.

British construction companies suffered a second straight month of contraction in the face of deep uncertainty about the outlook for the inflation-hit economy, a survey showed on Tuesday.

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Britain's private sector slowed to a crawl in August as factory output fell and the larger services sector eked out only a modest expansion, adding to signs that recession may be looming, a closely watched survey showed on Tuesday.

Britain borrowed more than expected in July, official data showed, underscoring the challenge facing the country's next prime minister over how to provide more support to consumers hit by rocketing energy costs.

British shoppers spent more than expected last month after being enticed by online shopping deals, official figures showed on Friday, but sales volumes look set to resume their decline as households face the highest inflation in 40 years.

Britain's financial watchdog has told firms offering 'buy now, pay later' loans to spell out the cost of late repayments to customers as the UK cost-of-living crisis intensifies.

Plans for a high-wage, high-growth economy lie in ruins as Britain's Conservative prime minister struggles to answer a cost-of-living crisis, compounded by rising worker unrest.

Britain's economy shrank in the second quarter, official data showed Friday.

Britain's economy contracted by less than feared in June, when public holidays had been expected to exert a big drag.

Britain's economy grew unexpectedly in May, driven by a rise in doctor appointments but also broader demand for things such as holidays, according to data that could reassure the Bank of England about its plans to keep on raising interest rates.

The resignation of Prime Minister Boris Johnson deepens the uncertainty hanging over Britain's economy, already under strain from an inflation rate heading for double digits, the risk of a recession and Brexit.

Bank of England chief economist Huw Pill warned on Wednesday that Britain's economy would slow to a crawl over the next 12 months and repeated his preference for a "steady-handed" approach to raising interest rates.

Britain's economy is struggling under the strain of two major risks in the form of double-digit inflation and a possible recession, leaving the Bank of England in a dilemma about how much further it should raise interest rates.

Rocked by a major revolt against his leadership this week, British Prime Minister Boris Johnson will on Thursday promise to rejuvenate a flagging economy and make it easier for young people to buy homes.

With two public holidays on Thursday and Friday, then the weekend, supermarket chain Co-op predicted "a bigger sales period than Christmas".

The BoE has raised interest rates four times since December, and is likely to increase them further this year to tame inflation.

The job cuts, to be carried out over the next three months, include losses from its central support centre, in regional management and in its UK stores.

The UK economy contracted by 2.2 percent in the first quarter.

The nation's second-quarter contraction is meanwhile expected to be far steeper than the first.

Britain has seen more than 32,000 deaths in the outbreak.

On eve of Brexit, there is a strong possibility that the Bank of England will later Thursday announce its first interest rate cut in more than three years.

Johnson says Brexit will free up the new government to concentrate on trying to grow the stalled economy.

Senior economist Boris Glass said the U.K. economy has foregone economic activity of £6.6 billion in each of the 10 quarters since the 2016 referendum.