A character of a group representation is obtained by taking trace of each matrix in this representation.
The word character is often used in the sense that it is a homomorphism from a group to $(\mathbb C\setminus\{0\},\cdot)$ (sometimes with some additional properties). This kind of characters arises, e.g., in Pontryagin duality or as Dirichlet characters in number theory.
Is there some relation between these two (frequently used) meanings of the world character, or is it just a coincidence that the same word was used for both of them?
A $1$-dimensional representation of a group is a continuous homomorphism into $\Bbb C^\times$: in particular it is equal to its own trace (once we identify $\mathrm{GL}_1(\Bbb C)\cong\Bbb C^\times$). So the group homomorphism definition of characters is the $1$-dimensional case of the trace-of-a-representation definition. To copy myself:
(Over here.)