The Bank of England (BoE) has decided to keep interest rates unchanged at 5%, following an 8-1 vote, as inflation remains stubbornly above the target. UK inflation holds steady at 2.2% despite rising air fares that offset lower petrol prices. The decision comes in the wake of significant cuts by the US Federal Reserve, indicating a cautious approach from the BoE to avoid unnecessary pain in the economy. Analysts predict that the BoE may consider gradual easing in the future, especially as inflationary pressures persist. The British pound has reached its highest level since March 2022 amid the announcement. European markets also reacted positively to the news.