This book by a leading authority on monetary policy offers a unique view of the subject from the perspectives of both scholar and practitioner. The book discusses the changes in the conduct of monetary policy in recent years, in particular the turn to inflation targeting. It sums up -Everything You Wanted to Know about Monetary Policy Strategy, But Were Afraid to Ask,- and reflects on what we have learnt about monetary policy over the last thirty years. The book blends theory, empirical evidence, and extensive case studies of monetary policy in advanced and emerging market and transition economies. Throughout, its focus is on the following key areas : the importance of price stability and a nominal anchor fiscal and financial preconditions for achieving price stability central bank independence as an additional precondition central bank accountability the rationale for inflation targeting the optimal inflation target central bank transparency and communication the role of asset prices in monetary policy.