Britain faces the risk of sliding back into recession and the central bank’s growth forecast for this year and next may be too optimistic according to a senior Bank of England economist.

Martin Weale, who is a member of bank’s Monetary Policy Committee, also said in a newspaper interview that he did not think there was a substantial risk of inflation spiralling out of control in the UK.

Britain’s economy emerged from an 18-month recession at the end of 2009 and its robust growth since then has surprised analysts.

However, tight credit, government spending cuts and weak consumer confidence have been cited as serious risks to the recovery.

Weale’s comments helped push the pound to a one-month low against the dollar.

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A chief economist at the Chamber of Commerce has been quoted as saying that he expects the economy of the United Kingdom to be strengthened by business investment over the medium term, in the next few years. The expectation includes the hope that net exports will also play a part in driving the UK economy forward, by adding a positive net balance of trade to the bottom line of the country’s finances. The comments come as forecasts are being repeated of only modest growth in the British economy overall in the years 2011 and 2012, with inflation expected to peak in 2011 and unemployment expected to peak in 2012.

The precise implications to small and start-up businesses of the business investment that is hoped for remain slightly unclear. Many entrepreneurs will be hoping that finance for business growth and for start-up businesses may become a little easier to find, given the need at national level for small and start-up businesses to succeed in the current global financial situation, which many entrepreneurs are still finding challenging. A further hope that has been expressed alongside the wish for more relaxed bank lending to businesses is the easing of regulatory bureaucracy and business taxes, which some people think are a barrier to the formation and success of small start-up businesses in the United Kingdom.

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