In general, if a central bank chooses to target the interest rate in its implementation of monetary policy, then

1. the implementation of policy is more straightforward because the central bank knows precisely the slope and position of the money demand curve.
2. the central bank can more easily control the process of deposit creation by the commercial banks.
3. it conducts the necessary open-market operations to accommodate the resulting change in money demand.
4. it is more difficult to communicate this policy to the public than a change in money supply.
5. the money supply is determined by the Minister of Finance.