US President Donald Trump has issued an executive order to stop minting pennies, citing wasteful government spending. The move is not unexpected, as economists have long argued that the production of pennies costs more than they’re worth.
The US Mint produces billions of new pennies each year to replace lost ones, with nearly 250 billion pennies in circulation as of last year. Trump’s plan would require an act of Congress to materialize, but many experts expect it will spark resistance from the US Mint and lawmakers.
One major argument against pennies is that they cost more than 2 cents to produce. Eliminating them could lead to vendors rounding prices up to the nearest five-cent increment, which might have a minor impact on prices compared to recent inflation rates.
If Trump’s order were to go into effect, it wouldn’t necessarily mean that pennies aren’t legal tender anymore. You can still use existing pennies for purchases or receive change from stores. However, some unique designs might become collector’s items.
It remains to be seen whether nickels will also be affected by the plan. Economists warn that stopping one coin could lead to financial losses and unintended economic consequences, making it a complex issue with potential far-reaching impacts.
Source: https://www.cnet.com/personal-finance/trump-says-no-more-making-pennies-what-that-means-for-you