US Treasury unveils plan to end production of penny coin

US Treasury unveils plan to end production of penny coin

The U.S. Treasury Department has announced its intention to stop producing new pennies, a move that will save the federal government millions of dollars annually. The decision comes after President Donald Trump directed the Treasury to cease penny production in February, citing the high cost of minting the one-cent coin.

According to the Treasury, the cost of producing a single penny has more than doubled in the past decade, rising from 1.3 cents to 3.69 cents in 2024. The Mint reported losing $85.3 million on making pennies in fiscal year 2024, highlighting the financial burden of penny production. The Treasury estimates that ending penny production will save $56 million annually in reduced material costs [1].

The Treasury's decision has sparked debate among economists and advocates. Mark Weller, executive director of Americans for Common Cents, argues that eliminating the penny would increase government losses and have unintended economic consequences. He believes that businesses would likely round up prices, potentially leading to higher costs for consumers [3].

In response to the Treasury's plan, bipartisan legislation has been introduced in Congress to end penny production and mandate rounding up or down to the nearest 5 cents in cash transactions. The legislation aims to save nearly $100 million spent on penny minting annually [2].

The U.S. penny, first minted in 1792, has been a staple of American currency for over 230 years. The decision to phase out its production marks a significant change in the nation's monetary system. The Treasury's move is expected to take effect once the current supply of penny blanks runs out, likely in early 2026 [1].

References:
[1] https://www.usnews.com/news/business/articles/2025-05-22/us-mint-moves-forward-with-plans-to-kill-the-penny
[2] https://www.newsmax.com/us/treasury-penny-production-2026/2025/05/22/id/1211967/
[3] https://abcnews.go.com/US/treasury-department-phase-penny-after-trump-coin-longer/story?id=122070266