Why is it significant that Christians are called the people of God?

Christians being termed the people of God signifies their unique status and relationship with God through the new covenant established in Christ. 1 Peter 2:9 emphasizes that believers are a chosen generation and a royal priesthood. This identity is not based on ethnicity or heritage but on divine election and grace, as God has redeemed them through Christ's atonement. This designation carries the responsibility for believers to reflect God's character and mission to the world, acting as ambassadors of His grace and light.