US President Donald Trump has ordered the US Treasury to stop minting new pennies, citing their production as “wasteful”. The decision comes amid rising costs and decreasing demand for low-denomination coins.
According to the US Mint, producing pennies and nickels costs more than their face value, with costs of 3.7 cents per penny and 13.8 cents per nickel in the 2024 fiscal year. Many countries have already phased out lower-denomination coins, including Canada, which eliminated its penny in 2012.
Some argue that eliminating pennies could fuel inflation by rounding prices to the nearest five-cent increment. However, experts suggest that this would have a negligible impact on the economy.
The idea of phasing out pennies has been discussed for years, but previous attempts were met with resistance. In 1976, then-Treasury Secretary William E. Simon proposed phasing out the penny by 1980, but it never materialized due to inertia and lobbying from companies involved in coin production.
The US Mint produces billions of pennies each year, using copper and zinc. With declining demand and rising costs, Trump’s decision may lead to a significant change in the way coins are handled in the US.
Source: https://www.washingtonpost.com/nation/2025/02/10/trump-us-mint-penny-coins