What is the meaning of fluency in Common Core Standards?

Fluency is not meant to come at the expense of understanding but is an outcome of a progression of learning and sufficient thoughtful practice. It is important to provide the conceptual building blocks that develop understanding in tandem with skill along the way to fluency; the roots of this conceptual understanding often extend one or more grades earlier in the standards than the grade when fluency is finally expected. (PARCC MCF, v3.0, p. 12)
Wherever the word fluently appears in a content standard, the word means quickly and accurately. It means more or less the same as when someone is said to be fluent in a foreign language. To be fluent is to flow: Fluent isn’t halting, stumbling, or reversing oneself. A key aspect of fluency in this sense is that it is not something that happens all at once in a single grade but requires attention to student understanding along the way. It is important to ensure that sufficient practice and extra support are provided at each grade to allow all students to meet the standards that call explicitly for fluency. (PARCC MCF, v3.0, p. 9)
Retrieved from: http://tncore.org/sites/www/Uploads/2.25.13Additions/fluency%20documents%20final.pdf on 9/3/2013

How does fluency differ from having instant recall of each and every basic fact?

The following address addition facts but also applies to multiplication facts. For Addition: "...a fluency approach to learning basic addition facts places a focus on developing and using mathematical strategies, with the goal of finding efficient, effective ways to apply known facts to derive unknown facts."

Kling, Gina. Fluency with Basic Addition, Teaching Children Mathematics, September 2011, NCTM. Retrieved from https://ccgpsmathematicsk-5.wikispaces.com/file/view/fluency_article_TCM_sept.pdf on 9/3/2013

What does fluency look like in a student?

"Fluent students use the facts they have memorized in flexible, mathematically rich, and efficient ways to derive facts they do not know."

Kling, Gina. Fluency with Basic Addition, Teaching Children Mathematics,
September 2011, NCTM. Retrieved from https://ccgpsmathematicsk-5.wikispaces.com/file/view/fluency_article_TCM_sept.pdf on
9/3/2013

Strategies for Understanding

The following order is suggested for understanding multiplication:
  1. Multiplication on a Number Line
  2. Arrays
  3. Skip Counting & Songs
  4. Advanced Arrays
  5. Using Known Facts to Determine Unknown Facts

Strategies for Recall

After students have comfortably developed several strategies to determine every multiplication fact, you can use these activities to help improve recall.
[The] speedy recollection of facts should not be confused with real mathematical skill. Good mathematical strategies -- not quick memorization -- are what really matters in understanding mathematics. (Mokros, Russell, and Economopoulos 1995, p. 72) .