Fiat money is a type of currency that has no intrinsic value and is not backed by a physical commodity, such as gold or silver. Instead, its value comes from the trust and confidence that people have in the issuing government or authority. Most modern currencies, like the US dollar and the euro, are examples of fiat money. Governments control the supply of fiat money, allowing them to manage economic stability and inflation. Because it is not tied to a physical asset, fiat money can be printed or minted in response to economic needs, making it a flexible tool for managing a country's economy.