A central bank issues currency and wants to target the price of apples in terms of that currency. So it opens an apple window, and posts a sign promising to buy or sell unlimited quantities of apples at $1 each. Done. Arbitrage ensures that the market price of apples in the economy is always $1 each, plus or minus transportation costs to or from the central bank's apple window.
If the central bank wanted to target 2% apple price inflation, it could simply change the price on the sign daily, so it rises at 2% per year.
Suppose the central bank found it was selling too many apples, and it was scared of running out of apples reserves? It could sell something else it owned (maybe government bonds?) to reduce the stock of currency in circulation, to reduce the quantity of apples it needs to sell.
Suppose the central bank found it was buying too many apples, and was scared it was running out of room to store all its apple reserves? It could buy something else (maybe government bonds?) to increase the stock of currency in circulation, to reduce the quantity of apples it needs to buy.
(That's how the gold standard worked, except it was gold rather than apples.)
If the central bank bought or sold exactly the right amount of that something else, and did so quickly enough whenever it saw people running to the apple window carrying either currency or apples, it would never need to buy or sell any apples. The apple window could remain open, but would never have any customers.
Or it could close the apple window, and just watch the market price of apples instead of watching whether the people running to the apple window were carrying currency or apples.
(That's how inflation targeting works, except it is a basket of apples, bananas, and haircuts, and other stuff, rather than just apples.)
But maybe buying and selling something else (like government bonds?) isn't the only way the central bank could reduce the amount of buying and selling it does at the apple window. Maybe an alternative is varying the rate of interest it pays people to hold currency?