First, thank you for your patience. I'm currently writing a catechetical book, and it is not on good time management, believe me. But we continue with Pope Benedict XVI's wonderful apostolic exhortation, Verbum Domini.
We're in final section of Part One, titled The Interpretation of Sacred Scripture in the Church. It takes two sentences for the Holy Father to get into the question of "authentic hermeneutics". Before we can read on, then, we must ask: what is a hermeneutic?
Hermeneutics is "the art and science of interpreting the Sacred Scriptures and of inquiring into their true meaning." The word comes from the Greek "hermeneus" or "interpreter" (Hardon 1999). The word "hermeneutics" itself doesn't imply interpretation of Scripture, but that's become the common meaning (Maas 1910). It makes sense, then, for the Holy Father to describe the Church as "the primary setting for biblical hermeneutics". The Church is, after all, the pillar and bulwark of the Truth (1 Tim 3:15).
When Philip encounters an Ethiopian eunuch reading Scripture (Acts 8:26-40), he asks the man "do you understand what you are reading?" The eunuch rightly replies, "how can I, unless someone instructs me?" Philip interprets a passage from Isaiah in relation to Christ. Here we see his hermeneutic - his law (Hardon 1999) or rule for interpreting the prophet. If Philip didn't know or believe in Christ, he would have a different set (and a wrong set) of rules for interpreting the passage in question.
Hermeneutics shouldn't be confused with exegesis; the two terms are very closely related. Exegesis is the process of interpreting and expressing the meaning of Sacred Scripture. Hermeneutics are the rules for conducting such work. You can do exegesis without good hermeneutics, just as you can drive a car without traffic laws. Both, I expect, would end with roughly the same results.
Hardon, John. 1999. "Hermeneutics". In The Modern Catholic Dictionary. Inter Mirifica.
Maas, A. 1910. "Hermeneutics". In The Catholic Encyclopedia. New York: Robert Appleton Company. http://www.newadvent.org/cathen/07271a.htm (accessed April 13, 2011).