Ammon News - AMMONNEWS - Jordan's Central Bank said on Monday it would cut its benchmark lending rates by 25 basis points on Tuesday, its first reduction since last June, following a record build-up in foreign reserves and an improved inflation outlook.

The Central Bank of Jordan (CBJ) said it would trim its discount rate to 4.00 percent and overnight repo rate to 3.75 pct as of Tuesday. The rate on weekly/other repurchase agreements was cut to 2.75 percent.

The bank attributed its decision to a combination of slowing inflation, the increased attractiveness of dinar-denominated assets and a big improvement in the current account, which it said reflected robust economic growth and a record level of foreign exchange reserves.

The CBJ said it was "continuing to follow all monetary and economic developments to ensure monetary stability and promote an attractive investment climate".

Despite the pressure on Jordan's economy from the cost of accommodating hundreds of thousands of Syrian refugees, the economy is gaining strength, with growth recovering from a trough of 2.3 percent in 2010 to a forecast 3.8 percent in 2014.

Inflation is expected to decline to about 2 percent by the end of 2015 from around 2.5 percent in 2014 due to a sharp fall in oil prices, officials say.

*Reuters