- - Lloyds share price rebounded today, but this rebound remains on shaky ground after UK GDP data for Q4 2025 revealed UK economic contraction.
- - The GDP data has repriced the BoE rate pathway more dovishly, which could have bearish repercussions on Lloyds share price, especially as the charts reveal potential trend exhaustion.
Lloyds’ share price rebounded this Thursday, with shares trading 0.19% higher as of writing. This represents modest relief for the bank’s stock, which has endured steep losses at the start of February.
Lloyds’ share price is benefiting from an improvement in the risk tone around Europe. European equities had earlier pushed to record levels amid earnings beats, and financial services stocks have been among the biggest winners this Thursday, gaining 1.3% on average. The uplift in financial services stock also rubbed off on UK banking stocks, enabling the modest bounce in Lloyds, a UK bank stock beta.
Furthermore, the buyout of UK asset manager Schroders by Nuveen in a $13.5 billion deal (9.9 billion pounds) was well received by investors, driving demand in UK stocks for the day. This demand sent the FTSE 100 to a fresh record high, driven by constructive UK risk sentiment.
However, Lloyds’ share price is still down 3.09% this week, and if it closes this way, it will be the second straight week of losses for the bank. UK GDP growth remains a headwind, as a 0.1% increase in Q4 2025 was interpreted as a major boost to Bank of England rate-cut bets in March. This metric capped the upside in Lloyds Banking Group stock, as rate cuts can compress banks’ margins.
Lloyds Share Price: What is the Dominant Macro Driver at the Moment?
The macro drivers for Lloyds’ share price forecasts for 2026 have been discussed on this website. However, Thursday’s GDP data release for Q4 2025, which came in at 0.1% (down from the 0.2% revised prior), indicates an economic contraction. The underwhelming data has led to a UK interest rate repricing scenario, and this is now the dominant macro driver.
Given the stellar US employment data of 11 February that has also led to a hawkish repricing of Fed easing expectations, the markets are now trading the notion that the Fed will keep policy restrictive for longer than previously envisaged, while the BoE will now lean towards faster/more aggressive easing in response to the slower growth data. Depending on the outcome of Friday’s US CPI data, the recent repricing of Fed cuts could either wane or intensify, with implications for Lloyd’s share price and the British Pound.
Lloyds Share Price: Technical Outlook
Lloyds’ share price remains in an uptrend. However, the appearance of a bearish pinbar candle and the subsequent bearish weekly candle that now tests a key support at 103.55 (27% Fibonacci extension of the 23 June 2025 – 1 December 2025 upswing) brings concerns that the trend may be nearing exhaustion.
The bears would be seeking to degrade this support to extend the pullback move towards 93.62, the 11 December 2025 swing low. This would also bring the bears in confrontation with the ascending trendline. If the bears overcome this new support and the trendline, a further decline towards 85.84, the low of 21 November 2025, cannot be ruled out.
Only a bullish defence of 103.55 and subsequent push above the 111.65 – 114.60 resistance zone (61.8% Fibonacci extension – monthly high) will re-establish the uptrend and allow the bulls pursue further northern targets at 120.50 (100% Fibonacci extension) and possibly 155.15 (March 2003 low).