At the moment, in my opinion, Central bank's decisions and market's behaviours define the economy.

Therefore, I see the following problems:

1️⃣ Because it is a multivariate "equation" that impacts itself, it is impossible to predict what will happen.

2️⃣ Central Banks can't know everything about the markets, therefore, they setup some signals to pay attention to. This basically decreases the problem space, but might leave out important information.

3️⃣ Economic data has a lag, therefore Central Banks only see information of the past, but not the present.

4️⃣ Intervention into monetary processes (artifically setting interest rates, printing money, etc) kill the prices. Prices won't be affected by natural supply and demand, but an artifical supply and demand. Therefore prices can't be used as signal anymore. Also Central Banks couldn't monitor all prices anyway.

5️⃣ This whole thing of Central Bank interventionism is basically stopping free market solutions.

This is similar to that, when we set the price of a good. This either result in product surplus or deficiency. This is due to intervening into free market processes.

Solution:

Use a monetary media, that supply can't be increased, and let the market decide on the interest rates. Let lenders and borrowers decide on the interest rate, as we do with other common products.