A text item created using the Text tool can be transformed into a path using the Path from Text command in the context menu of the Text tool. This can be useful for several purposes, including:
Stroking the path, which gives you many possibilities for fancy text.
More importantly, transforming the text. Converting text into a path, then transforming the path, and finally either stroking the path or converting it to a selection and filling it, often leads to much higher-quality results than rendering the text as a layer and transforming the pixel data.