Britain's economy shrank far more than expected in the second quarter, battered by everything from an extra public holiday to government spending cuts and the neighbouring Euro zone crisis.
Finance minister George Osborne said figures released on Tuesday showed Britain had deep-rooted economic problems, adding that the slump in the second quarter was disappointing even when taking into account one-off factors that hurt.
Britain's GDP fell 0.7% compared with the first three months, the sharpest fall since the height of the global financial crisis in early 2009, the Office for National Statistics said.
Output in Britain's service sector (which makes up more than three quarters of GDP) contracted by 0.1% in the second quarter after growing 0.2% in Q1 2012.
Industrial output was 1.3% lower, while construction - which accounts for less than 8 percent of GDP - shrank by 5.2%, its biggest drop since the first quarter of 2009.
The figures confirmed that Britain remains mired in its second recession since the start of the financial crisis, with the economy shrinking for a third consecutive quarter.
But despite the bad news the Olympic Games this month are expected to be a big boost for tourism and trade, benefiting the City of London with over 7 billion dollars.