Do increases in the money supply cause or accelerate inflation?

Do increases in the money supply cause or accelerate inflation?

Let’s consider the evidence…

First, a chart of the annualized percentage changes in the money supply (M1) and consumer price index (CPI).

We can also look at the same data, but use the absolute value of the money supply. Again, inflation does not seem correlated with increases in the money supply.

Let’s look at other economies and monetary bases. First up: the Eurozone.

A look at China:

A look at Japan:

And finally, the UK:

Verdict: increases in the money supply do not necessarily cause or accelerate inflation. The above charts represent decades of data from the five largest economies during a period of unprecedented increases in the money supply. I understand that there is a logical rationale and belief that printing money leads to inflation, but it is simply not true. I am not sure what more evidence can be provided, yet the myth persists nonetheless.