US ends penny-making run after more than 230 years
The USA is preparing to get its last penny.
The Philadelphia Mint will strike its final batch of one-cent coins on Thursday after more than 230 years of production.
The coins will remain in circulation, but the phase-out of coins has prompted businesses to adjust prices as they say pennies are becoming harder to find.
The government says the move will save money, or as President Donald Trump said when he first announced the plans in February: “Take waste out of our great nation’s budget, even if it’s just a penny.”
The pennies honoring Civil War president Abraham Lincoln and made of copper-plated zinc cost almost four cents to produce today; That’s more than double the cost a decade ago, according to the Treasury Department. It estimates that the decision to end production will save about $56 million a year.
Officials argued that the rise in electronic transactions has made the penny, which first went into production in 1793, increasingly controversial.
The Treasury Department estimates that about 300 billion coins will remain in circulation, “far in excess of the amount needed for commerce.”
Many pennies go out of use. Approximately 60% of all coins in circulation in the United States (or approximately $60-$90 for a typical household) are stored in home piggy banks deemed untradeable. According to 2022 government analysis.
But money enthusiasts beware: The move is expected to increase costs for shoppers as businesses begin rounding up prices. One Study by researchers at the Federal Reserve in Richmond It is estimated that this could cost consumers $6 million annually.
Other countries have also phased out their lowest-value coins. For example, Canada produced its last batch of one-cent coins in 2012.
Australia and New Zealand retired one- and two-cent coins in the 1990s, and New Zealand stopped producing five-cent coins in 2006.
Britain publicly presented a plan to scrap 1p coins in 2018, but the proposal was later withdrawn.
But the rise of electronic transactions led Britain to halt coin production in 2024 after authorities decided there were enough 1p and 2p coins in circulation.
In the United States, attention now turns to nickel, which has a face value of five cents but costs about 14 cents to produce.
Retiring this coin would have a much larger impact on shoppers, costing consumers approximately $55 million annually, according to Richmond Fed research.
