Summaries This article examines the development of monetary policy in Russia since prices were liberalised in 1992. It traces events from the monetary overhang which preceded that step, through sharp inflation and the monetary contraction with which stability was restored, to the present crisis of illiquidity and demonetisation. The article argues that, far from easing the way to flexible, market‐based policies, this chain of events has left policymakers as severely boxed in as at the start. While any reform strategy was fraught with danger, it would have been better to take a less cavalier attitude to prices and concentrate from the beginning on building the financial and legal institutions required for macro‐economic policy to work.