Explanation: When a government prints money, it is in essence borrowing interest-free since it receives goods in exchange for the money, and must accept the money in return only at some future time. It gains further if issuing new money reduces (through inflation) the value of old money by reducing the liability that the old money represents. These gains to a money-issuing government are called "seignorage" revenues.
The original meaning of seignorage was the fee taken by a money issuer (a government) for the cost of minting the money. Money itself, at that time, was intrinsically valuable because it was made of metal.
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