We purify the mind while we bathe the baby Buddha.

The Venerable Master Hua explained:

The Buddha is a greatly enlightened individual, someone who has truly understood. There's no need for us to wash his body, which is clean and pure. Yet, why do we bathe the Buddha? To do so symbolizes the bathing of our mind and its return to purity. It is also a form of commemoration, in memory of our teacher who passed away long ago; it is one way to be filial to the Buddha. Buddhists have this tradition of bathing the baby Buddha because on the day the Buddha was born, nine dragons spouted water. This is how this ceremony came down through the ages.