The oracle becomes less oracular

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: In all probability, the European Central Bank will raise interest rates on December 7th for the sixth time in a year. Economists who follow the ECB are pretty sure of this, largely because Jean-Claude Trichet, the bank’s president, said a month ago that “strong vigilance remains of the essence.” To ECB-watchers this unremarkable phrase is as close to a commitment as they could ask for: Mr Trichet has spoken of “vigilance” before every one of the past year’s rate increases. And Mr Trichet knows his words are read this way. So rates are all but sure to go up.

Only a few years ago most central banks gave no clues to their thinking. Until 1995 the Federal Reserve did not even publish its target for the federal-funds rate: people in the markets had to work things out for themselves. For some central banks, taking financial markets by surprise with a sudden increase or cut in rates was almost a matter of honour. These days, however, central banks often give markets a steer. The Fed, like the ECB, has used phrases it knows will be easily decoded. At every meeting from May 2004 to November 2005, it signalled one quarter-point rate increase after another by saying that it believed “policy accommodation can be removed at a pace that is likely to be measured.” The words changed as the time for a halt drew nearer (the rate has remained at 5.25% since June).

A couple of central banks are much more daring. They talk plainly not only about next month’s rates but also about next year’s or the year after’s. The Reserve Bank of New Zealand has been publishing interest-rate forecasts since 1998. In 2005 Norges Bank, the Norwegian central bank, began projecting rates three years ahead. How far can central bankers go?

Don’t be shy