Central banks share similar functions all over the world, which reflects that their historical development is quite alike despite their geographical or political differences. If you visit the sites of central banks, the similarities are striking. This chapter describes the general and specific functions of central banks, with special regard to the dominant monetary policy framework, the inflation targeting. It summarizes the difficulties of the precrisis Hungarian Central Bank as a nonregulatory, nonsupervisory institution and analyses the reasons for the failure of inflation targeting in Hungary.