The implementation of inflation targeting Before inflation targeting is implemented, it is important that: •  a decision is taken on the inflation target that will be set;  •  a satisfactory forecasting framework is developed; and  •  a high degree of transparency is ensured.
In all inflation targeting countries the practice has been to specify the target in terms of the consumer price index, or some variant thereof. There is, however, no consensus on how inflation should be measured. Preferably the index should include a range of products whose prices fully describe changes in the cost of living and are generally accepted by the public.