Inflation determined both by the amount of money in the economy and the velocity of that money. The velocity of money is how fast people spend money that they earn.

To use a very simplified example. Assume that under normal conditions there is $100 in cash in the economy and everyone takes 6 months to spend the cash that they earn. One way you can cause prices to double is by doubling the amount of cash in the economy to $200. Another way that prices can double is if everyone starts spending the money they earn twice as fast - so prices will also double if the amount of cash remains at $100 but now everyone spends the money they earn in 3 months rather than 6.

The money supply is at a historical high - it almost quadrupled over the last 10 years. However, inflation is low because the rate at which people are spending that money is also at a historical low. Depending on which measure of the monetary supply you want to use, the rate at which money is being spent is anywhere from 1/2 to 10% of normal levels.

Because of that the Fed is concerned that even a small rise in the rate at which people are spending money will result in a sudden, unpredictable, and large rise in inflation and they are taking pre-preemptive action to keep the rate at which people are spending money low.