The rates decisions came against a backdrop of improved economic data from both the euro zone and U.K.
The pan-European FTSEurofirst 300 provisionally closed higher by 0.5 percent at 1,221.43 points.
The BoE decided to keep the main interest rate unchanged at a record low 0.5 percent and said it would not add to its £375 billion ($571.6 billion) quantitative easing program.
After falling sharply on Wednesday following a profit warning from Ryanair, airlines shares rebounded after reporting strong traffic figures. Easyjet was an out-performer on the FTSE 100 on Thursday, trading up 1.64 percent after the budget airline reported a jump in passenger traffic in August.
The FTSE 100 hit a three-week high, as Lloyds led banks higher, in what looked set to be the sector's strongest session in two months. Lloyds rose 2.65 percent after both Bernstein and Morgan Stanley gave a target share price of 100 pence for the bank, currently trading at 73 pence.
The auto sector traded 2.28 percent higher after data showed U.S. auto sales gained 17 percent in August, in the industry's strongest month since the 2007 crisis.
Shares of Intercontinental Hotels Group rose 1.96 percent after UBS raised the stock to a buy, while retailer Marks and Spencer's shares rose 3.05 percent after HSBC raised the stock to overweight.
ISM highlights strong service sector growth
In the U.S., the pace of growth in the services sector rose to 58.6, the highest since December 2005, according to the Institute for Supply Management. Plus, weekly jobless claims declined to a near five-year low, according to the Labor Department. But the Commerce Department noted that factory orders dropped 2.4 percent in July.
In Asia, equities ended the day mainly higher on Thursday, with Indian stocks outperforming after the country's new central bank governor unveiled moves to liberalize banking and shore up the rupee.
Follow us on Twitter: