FRANKFURT AM MAIN — Growth in lending to eurozone businesses and households accelerated in October, ECB data showed on Thursday, in welcome news for the central bank after it unleashed fresh stimulus to boost the economy.

Credit to non-financial firms grew 3.8 percent year-on-year compared to 3.6 percent in September, the European Central Bank said in figures adjusted for some purely financial transactions.

Lending to households increased at a steady clip of 3.5 percent, 0.1 percentage point more than in September.

Overall, private sector credit growth ticked up from 3.6 to 3.7 percent.

The monthly data is closely watched to gauge the effectiveness of the ECB's efforts to encourage lending and investment in the single currency bloc in a bid to drive up economic growth and stubbornly low inflation.

The ECB's new president Christine Lagarde took over from Mario Draghi at the start of November, vowing to stick closely to her predecessor's easy-money policies.

In one of his final acts as ECB chief, Draghi in September announced a new stimulus package to confront a darkening eurozone outlook.

That included cutting a key interest rate deeper into negative territory and loosening conditions on a new round of cheap credit to lenders.

More controversially, the bank also relaunched corporate and government bond purchases to the tune of 20 billion euros ($22.2 billion) a month, sparking rare public criticism from some of the ECB's governing council members who said the move was too drastic.

Lagarde, the former head of the International Monetary Fund, has said that monetary policy needed to remain "highly accommodative" for "an extended period of time". — AFP