The US Treasury has announced its decision to phase out the production of pennies, stopping new one-cent coins from entering circulation. The move, which was first reported by the Wall Street Journal, aims to reduce waste and save taxpayers $56 million annually.
President Donald Trump initially ordered the US Mint to stop producing new pennies in February, citing the cost. However, the actual cost of a penny is higher than expected, around 3 cents each to produce.
The real issue might be the high production costs for nickels, which are already losing money due to administrative and distribution expenses. The Treasury estimates that if the Mint stops producing new pennies, it will need to make more nickels to meet demand, potentially offsetting any savings.
Canada stopped minting its pennies in 2012 and eliminated them entirely in 2013. Many experts agree that eliminating the penny would speed up cash transactions and reduce waste. With an estimated 25-30% of pennies not being reused or recycled, the Treasury’s decision aims to address this issue.
Source: https://edition.cnn.com/2025/05/22/business/us-discontinue-penny