The roots of this consensus are (1) the greater appreciation of the benefits of price stability for durable economic growth and social welfare; (2) the recognition that monetary policy can effectively determine price developments over the medium and longer run, but cannot permanently and systematically influence economic activity; (3) growing evidence that independent central banks can pursue price stability effectively while minimising output volatility.
Despite the general agreement on the primacy of price stability as a monetary policy objective, there are differences of opinion on several related issues: (1) how this goal is linked and ranked relative to  BIS Review 51/2006  1  other policy objectives; (2) what is the appropriate strategy for policy formulation; (3) whether and how the concept of price stability should be defined in quantitative terms; (4) how to operationally specify a final policy target and in particular the measures of inflation and economic activity that central banks should aim to control.