The old winpty has a bug, when running terminal in VS Code: after executing MinGW command escape sequencies are broken.
We can disable those by modifying theme file in a following way
if ($env:ConEmuANSI -eq "ON") {
$prompt += Set-CursorForRightBlockWrite -textLength ($timestamp.Length + 1)
$prompt += Write-Prompt $timeStamp -ForegroundColor $sl.Colors.PromptForegroundColor
}
and by setting env:ConEmuANSI="OFF"
in the VS Code terminal environment for Windows.