This chapter explores the role of medium-scale New Keynesian DSGE models in macroeconomic analysis, particularly for understanding inflation. These models, prevalent in central banks and academia, are used to analyze inflation, monetary transmission, and policy effects. Despite their limitations in capturing crisis details, models like Smets and Wouters (2007) still effectively explain inflation and output fluctuations. The chapter reviews developments in the ECB's NAWM, including features like financial frictions and energy price shocks. These advancements have improved the models' forecasting and interpretation abilities, especially during periods of unconventional monetary policy. DSGE models are valuable for policy evaluations, allowing for comparisons of actual policy decisions against model-based optimal policies. Robustness analyses help evaluate policy rules from a welfare perspective, supporting the creation of sound monetary frameworks. The chapter identifies important challenges, particularly the need for improved supply-side structures. Enhanced modeling of nonlinear dynamics is crucial for accurately representing complex macroeconomic events. Ultimately, the chapter advocates for improving these models to better understand current macroeconomic realities. These models remain central to contemporary macroeconomic research and policymaking.