LONDON, April 26 Reuters Sterling held near its lowest levels since 2020 on Tuesday against a broadly firm dollar, with worries about Britain39;s economic outlook exacerbated by latest debt numbers and fears that COVID19 restrictions in China will hurt world growth.

Sterling was down 0.25 at 1.2702 at 1005 GMT, after falling on Monday below 1.27 for the first time since September 2020.

It is down over 3 this month against the dollar and set for its biggest monthly fall since September 2020, with growing signs of a weakening economic outlook hurting the currency.

Data on Tuesday showed British government borrowing in the recently ended 202122 financial year was almost 20 higher than forecast by the country39;s budget office last month.

That underscored the challenge for finance minister Rishi Sunak, who is under pressure to give new help to households and businesses hit by surging inflation, but who says he wants to fix the public finances after his COVID19 borrowing surge.

There is little sign of the pound moving back into favour with this mornings borrowing data highlighting the difficulties of the Chancellor in softening the impact of the cost of living crisis given the increased weight of debt maintenance, said Jane Foley, head of currency strategy at Rabobank.

Fears, meanwhile, that more stringent COVID19 measures in China could slow down the global economy encouraged investors to buy the safehaven dollar as Beijing ramped up plans for masstesting of 20…