After reducing Winter Fuel Payments for all but the most impoverished seniors, the newly appointed chancellor has come under increasing fire.

However, she acknowledged that it was the "right decision" and that there will be more difficult choices to make.

Her caution comes as fresh data reveals that the UK economy stagnated in June and did not expand in July.

The July result represents a setback for the recently elected government, which has made expanding the economy a top priority.

In an interview with the BBC, Reeves attempted to present a hopeful outlook for future expansion but cautioned that further fiscal restraint would be necessary this autumn.

The Chancellor claimed she was facing a £22 billion "black hole" in the public coffers this year, albeit around £9 billion of that is due to her choice to grant and finance pay packages for public sector employees that are higher than inflation.

There is growing conjecture on the taxes she may increase in the Budget and whether or not she will change the debt objectives she has promised to adhere to.

The government self-imposes what are called the "fiscal rules" in order to control its borrowing over a five-year period. Reeves would have greater control over tax and spending policies if these restrictions were changed. To yet, she has not ruled out making changes to them.

The Chancellor also mentioned plans announced by Amazon on Wednesday to invest £8 billion in the construction of data centres in the United Kingdom.

"It will help rebuild Britain and make every part of the country better off," the speaker declared.

The Treasury has also lost out on the increase in tax revenues that would have resulted from a better economic performance due to the lack of growth in July.

For July, analysts had predicted growth of 0.2%.

While industrial and construction output also decreased, the services sector had a lift from a summer filled with sporting events, including the Olympics and the Euros.

Liz McKeown, director of economic statistics at the Office for National Statistics (ONS), stated that "longer term strength in the services sector meant there was growth over the last three months as a whole" despite the fact that there was no growth in July.

Computer programmers and the health industry, which had recovered from June's strike action, led to the gain in services. However, Ms. McKeown noted that production for engineers, architects, and advertisers had decreased.

The gross domestic product, or GDP, is tracked monthly by the ONS, although trends over a three-month period are given greater consideration.

Monthly totals are an approximation and are frequently updated once further data becomes available.

The UK entered a slight recession at the end of last year, with the GDP contracting for two consecutive three-month periods. However, 2024's first half witnessed a return to growth.

(Sources: bbc.co.uk)