In 1923, Germany printed money to pay workers who were told to stay at home

Inflation was already very before this happened (see the link below to the Business Insider article). But having workers stay off the job reduces supply and the printing money to pay them increases demand (or at least replacing the lost demand with workers not getting paid). That led to the  hyperinflation. One source says that what cost 1 mark in August 1922 was 10,000,000,000 in November 1923. Prices rose 322 percent a month.

See The Weimar Republic from The Wiener Holocaust Library. Excerpt:

"Throughout the war, the value of the German currency, the Reichsmark, fell considerably. In 1914, one British pound was equal to twenty German marks. In 1919, one British pound was equal to 250 marks. To try and meet the requirements of government spending and alleviate the post-war situation, the government had little choice but to print more money. This in fact made the inflationary situation worse and again reduced the value of the Reichsmark.

Meanwhile, in the midst of this economic crisis, Germany continued to attempt to pay the reparations as dictated by the Treaty of Versailles. The reparations had to be paid in gold marks, which maintained its value, whilst the German currency declined. This made it more and more expensive to pay.

In 1922, Germany requested permission to suspend their payments whilst their economy recovered. This was refused by the Allies. By 1923, Germany reached breaking point as inflation started to run out of control. They were unable to continue paying reparations.

On the 9 January 1923, in response to the lack of payment of reparations, France and Belgium invaded the Ruhr. The Ruhr was a region of Germany which contained resources such as factories. The French and Belgians intended to use these resources to make up for the unpaid reparations.

German factory workers refused to co-operate with the occupying French and Belgian armies. With the German governments support, the workers went on strike. The French sent in their own workers, and arrested the leaders of the German strikers and the German police. This led to violence on both sides.

With the French and Belgian occupation of the Ruhr, goods in Germany became even more difficult to obtain, and therefore very expensive. To fix this problem and pay the striking Ruhr workers, the government again printed more money. This led to hyperinflation.

By the autumn of 1923 a loaf of bread cost 200,000,000,000 marks."

See also See The Weimar Republic 1918-1929 from The BBC. Excerpt:

"The Weimar government's main crisis occurred in 1923 after the Germans missed a reparations payment late in 1922. This set off a chain of events that included occupation, hyperinflation and rebellions.

French and Belgian occupation of the Ruhr

• In November 1922 Germany defaulted on its reparations payment as scheduled. The first reparations payment had taken all she could afford to pay. The French believed Germany could make the repayment but were choosing not to, however the German government argued they could not afford to pay.
• In response, France and Belgium sent troops into Germany’s main industrial area, the Ruhr Valley. Their aim was to confiscate industrial goods as reparations payments as they didn’t believe Germany was unable to pay the second instalment. They occupied coal mines, railways, steel works and factories – all things that were important to Germany’s economy.
• The German government ordered workers to follow a policy of ‘passive resistance’ – refusing to work or co-operate with the foreign troops and in return the government continued to pay their wages.
• The French responded firmly – in the Krupp steel works, workers refusing to take orders were shot at. Other people were expelled from the Ruhr region altogether. Overall, 132 were killed and approximately 150,000 expelled from the area.
• The immediate consequences of the occupation were not good for the Weimar government – they decided to print more money to pay the workers in the region, contributing to hyperinflation. A general strike (when all the workers in the country stopped work) was called, and political instability was rife.

• Germany was already suffering from high levels of inflation due to the effects of the war and the increasing government debt.
• ‘Passive resistance’ meant that whilst the workers were on strike fewer industrial goods were being produced, which weakened the economy still further.
• In order to pay the striking workers the government simply printed more money. This flood of money led to hyperinflation as the more money was printed, the more prices rose.
• Prices ran out of control, for example a loaf of bread, which cost 250 marks in January 1923, had risen to 200,000 million marks in November 1923.
• By autumn 1923 it cost more to print a note than the note was worth.
• During the crisis, workers were often paid twice per day because prices rose so fast their wages were virtually worthless by lunchtime."

See also WEIMAR: The Truth About History's Most Infamous Hyperinflation Horror Story by Matthew Boesler of Business Insider. It goes into more detail and is based on the book When Money Dies: The Nightmare of Deficit Spending, Devaluation, and Hyperinflation in Weimar Germany Paperback by Adam Fergusson.

Related posts:

World War I Finally Ends (a post from 2010 when Germany made the last payment for war reparations from World War I in 2010 that may have contributed to the hyper inflation)  

When workers were paid twice a day and given half-hour shopping breaks (Germany, 1923)