How to create dropdown menu from python list using Flask and HTML

You need to use {{colour}} in both places (instead of {{colours}} in the second place):

<select name="colour" method="GET" action="https://stackoverflow.com/">
    {% for colour in colours %}
        <option value="{{colour}}" SELECTED>{{colour}}</option>"
    {% endfor %}
</select>

Note that using selected inside the loop will add selected attribute to all options and the last one will be selected, what you need to do is the following:

<select name="colour" method="GET" action="https://stackoverflow.com/">
  <option value="{{colours[0]}}" selected>{{colours[0]}}</option>
  {% for colour in colours[1:] %}
    <option value="{{colour}}">{{colour}}</option>
  {% endfor %}
</select>