Economics
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Economic Outlook
The economy is expected to start 2025 on relatively weaker footing after higher than previously anticipated growth in 2024. Over the course of this year, consumption and jobs growth are expected to slow while real estate markets and corporate profits are projected to stagnate. Economic growth is anticipated to experience volatility in the first two quarters of 2025 as businesses react to uncertainty around tariff policy changes, leading to fluctuating net exports and inventories. Uncertainty is also expected to be a headwind to business investments and consumer demand during the year, leading to a downward revision in overall economic growth. Inflation growth is expected to re-accelerate this year largely due to changes in tariff policies, but with Colorado being impacted marginally less than the nation as a whole. Given that consumers and businesses alike tend to reduce spending and investments when uncertainty is elevated, OSPB has revised the likelihood of a recession in the next 12 months up to 40 percent, from 25 percent in the previous forecast.
