Magnetism is caused my the movement of electrons, ie current. Every electron has a “magnetic moment”. An atom can have a net magnetic field due to the arrangement of its electrons as they orbit the nucleus. A group of atoms, ie a magnet, gets its net magnetic field from large percentages of its atoms having aligned magnetic fields. When a magnet like this is heated the atoms unalign which is why the magnet ceases to be a magnet at temperature.
The earths core is essentially spinning molten metal. Metals have a lot of electrons. Which means moving electrons. Which means current. Which means magnetic field.
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