Forecasts as Repeated Cheap Talk from An Expert of Unknown Statistical Bias

For two periods an expert E announces his forecast of the state to a decision-maker D who chooses action. They disagree about the precision of the probability assessments. At the end of period 1 the state is observed. In the last period E is shown to make inflated announcements, more extreme than his forecasts. Despite countable equilibria, full revelation is never realised. When in period 1 E is interested in reputation only, the initial equilibrium partition is finite, and E makes initial announcements of higher uncertainty with respect to his forecasts. When in period 1 E is interested in action too, reputational concerns mitigate exaggerated reports.