When the central bank announces the desired inflation rate and sets policy to reach that rate, it is using:

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Inflation targeting is a monetary policy framework where the central bank sets a specific target for inflation and uses its monetary policy tools, such as interest rates or money supply, to achieve that target. This approach is used by many central banks around the world, including the Federal Reserve in the United States, the Bank of England, and the European Central Bank. The Taylor rule is a specific formula used to guide central bank policy, but it is just one approach within the broader framework of inflation targeting. Monetary neutrality policy and fiscal policy are not related to the specific approach of setting an inflation target.

When the Central Bank Announces the Desired Inflation Rate and Sets