The argument is that BI is non-inflationary because the total money supply is not being increased. BI simply re-allocates money from one person to another.

While that addresses inflation on an economy-wide scale, there are also arguments that apply to specific items. Take milk for example. Currently, if you are poor, you buy milk using SNAP vouchers or some other form of welfare. Under a BI system, the demand for milk doesn't change - we simply replace SNAP vouchers with cash from the BI.