By politics.co.uk staff

Victory in the 2010 general election will be a poisoned chalice for the winner, a leading US economist has warned.

David Hales said Bank of England governor Mervyn King had told him the necessity of cuts to public spending will damage whichever party forms the government.

Mr Hale told Australian TV: “I saw the governor of the Bank of England last week when I was in London and he told me whoever wins this election will be out of power for a whole generation because of how tough the fiscal austerity will have to be.”

Mr Hale was talking also about the possible knock-on effect of the Greek financial crisis.

The pound fell against the dollar this week after Greece’s credit rating was downgraded and has also been hurt by concerns over the prospect of a hung parliament.