Parents are their child's first teachers. Reading daily to your child, from birth on, helps to build literacy skills. The children hear the language spoken, parents point out items in the book and talk about them, and this begins the love of literacy. They absorb what is being talked about and it builds their understanding.
"Early literacy (reading and writing) does not mean early reading instruction or teaching babies to read; it is the natural development of skills through the enjoyment of books, the importance of positive interactions between babies and parents, and the critical role of literacy-rich experiences. Literacy development begins at birth and is closely linked to a baby's earliest experiences with books and stories. Babies learn language through social literacy experiences - parents interacting with them using books. These experiences also serve to associate books with parental affection, attention, and approval."
-The American Library Association