US Federal Reserve Chairman Ben Bernanke's decision to publish more details about the outlook for economic growth and prices represents a break with the legacy of former chairman Alan Greenspan and the cryptic phrases he used to signal policy.
"If you haven't thrown out your Greenspan decoder ring by now, you should," said Ethan Harris, chief US economist at Lehman Brothers Holdings Inc, a former head of domestic research at the New York Federal Reserve Bank. "Ben Bernanke is a very straight shooter. He tells it like it is. There are no hidden messages."
Bernanke said on Wednesday that Fed officials will add a third year to their forecasts and double the frequency to once a quarter. The reports will give investors and companies more details on why interest rates were adjusted and offer a map for where they are likely to go.
Analysis will shift to how the committee sees the outlook, away from trying to guess where the chairman stands, as was the case during Greenspan's 18 years at the helm, Fed-watchers said.
"He wants the committee to function like a committee," said former Fed vice chairman Alan Blinder, now a professor at Princeton University in New Jersey. "He doesn't want to dictate."
Greenspan, meanwhile, declined to comment.
Bernanke's forecasting overhaul brings the Fed closer to international central bank practices and comes at a time of diverging views between policy makers and investors.
Bernanke and other Fed officials have repeatedly underscored their confidence the economy will accelerate by the middle of next year after a lull this quarter. That hasn't stopped traders from assuming the central bank will cut rates at least once more after lowering borrowing costs in September and last month.
Futures markets show a 72 percent probability the Fed will cut the benchmark rate a quarter-point to 4.25 percent on Dec. 11.
Bernanke, 53, took office in February last year having pushed for increased transparency when he served as a Fed governor.
Yesterday's announcement was the product of his one-and-a-half-year review of Fed communication, and it fell short of the formal inflation target that Bernanke advocated as an academic.
At the same time Bernanke spoke on the changes, the Federal Open Market Committee (FOMC) released a statement detailing the new practices, illustrating that the decision was made jointly among policy makers.
Bernanke praised the "diversity of views" among the 12 district-bank presidents and seven Fed governors, who discuss rate decisions at FOMC meetings. He said the range of opinions "serves to limit the risk that a single viewpoint or analytical framework might become unduly dominant," a criticism of Greenspan's tenure.
He also took questions from the press after his remarks yesterday, another break from Greenspan.
Bernanke framed transparency as critical to the Fed's "democratic legitimacy" with the public, Congress and financial markets -- constituents that critics say the Fed hasn't always served in a balanced way.