Applying the Ordinary Least Square method and panel data analysis, the performance of inflation targeting (IT) regime is analyzed in 11 developed and developing economies. The results show that the implementation of inflation targeting has effectively reduced the inflation rate and stimulates high output growth. The reduction of inflation rate is larger in developing economies but the gain in higher output growth is larger in developed economies. On the other hand, there is strong evidence that inflation targeting has led to higher volatility in exchange rate of developed economies....