Over the last year there has been a veritable explosion of the money supply.

In the US, M2 has surged by 24pc. In the UK, M4 has increased by 12.8pc. And in the eurozone M3 has grown by 11pc.

The current monetary expansion shows itself in large increases in the bank deposits of households. Once they are in a position to spend this money, they are most assuredly going to do so.

There is no inevitable direct link between the money supply and inflation. Normally, the link operates through aggregate demand. 

Just as the monetary authorities can stoke the inflationary fires so they can also dowse them. But will they? That is a subject for another day.

Roger Bootle Telegraph 17 January 2021

https://www.telegraph.co.uk/business/2021/01/17/inflation-not-dead-thought-merely-resting/