Close Menu
News JournosNews Journos
  • World
  • U.S. News
  • Business
  • Politics
  • Europe News
  • Finance
  • Turkey Reports
  • Money Watch
  • Health
Editors Picks

U.S. Attempts Deportation of Serious Criminals on Flight Allegedly Bound for South Sudan

May 21, 2025

Trump Accuses Biden’s DOJ of Seeking to Transform U.S. into ‘Corrupt Communist’ Nation

March 15, 2025

Trump Dismisses Chief US Copyright Official Shira Perlmutter

May 11, 2025

Trump Announces Major Trade Deal with Key Ally Amidst Other Top Headlines

May 8, 2025

U.S. Returns Smuggled Artifacts, Including Ancient Gold Coin and Temple Parts, to Egypt

May 13, 2025
Facebook X (Twitter) Instagram
Latest Headlines:
  • Ozgur Ozel Addresses Party Dynamics in Confession About Kemal Kılıçdaroğlu
  • UN Rapporteur Faces Backlash Over Anti-Israel Report on Companies
  • Google Photos Introduces AI-Powered ‘Ask Photos’ Search Feature in the US
  • Fire Erupts on Dismantled Tanker at Aliağa Port
  • El Salvador President Refutes Prison Abuse Allegations by Kilmar Abrego Garcia
  • Zelenskyy and Trump Discuss Joint Defense Initiatives in Productive Call
  • PETA Distributes Vegan Hot Dogs at Nathan’s Hot Dog Eating Contest
  • Exploring Affordable Stocks Set for Second-Half Gains
  • Russia Recognizes Taliban Rule in Afghanistan, China Welcomes Decision
  • Lion Escapes and Attacks Woman and Two Children on Busy Pakistan Street
  • Schools Combat AI Cheating by Reverting to Pen and Paper Exams
  • What’s Open and Closed on July 4, 2025? Store and Business Hours Revealed.
  • Dozens Injured in Rome Gas Station Explosion
  • Apple’s F1 Achievement Overshadowed by AI Challenges
  • Gangs Control 90% of Port-au-Prince as Violence Escalates, Warns UN
  • Supreme Court Approves Deportation of Migrants from Djibouti to South Sudan
  • Poland Achieves Milestone with Renewables Surpassing Coal in Electricity Generation
  • Broadcaster Jabs Yankees Announcer After Blue Jays’ 4-Game Sweep
  • Miki Sudo Triumphs in 2025 Nathan’s Famous Hot Dog Eating Contest Women’s Division
  • 9 Key Strategies to Safeguard Your Phone and Recover from Hacks
Facebook X (Twitter) Instagram
News JournosNews Journos
Subscribe
Friday, July 4
  • World
  • U.S. News
  • Business
  • Politics
  • Europe News
  • Finance
  • Turkey Reports
  • Money Watch
  • Health
News JournosNews Journos
You are here: News Journos » U.S. News » Treasury Plans to End Penny Production
Treasury Plans to End Penny Production

Treasury Plans to End Penny Production

News EditorBy News EditorMay 24, 2025 U.S. News 5 Mins Read

The U.S. penny, once considered a staple of American currency, is on the verge of being phased out as the government seeks to cut unnecessary expenditures. Citing rising production costs, the U.S. Treasury has decided to halt the minting of pennies, with the last batch expected to circulate early next year. This decision is part of broader fiscal measures aimed at reducing government spending, despite concerns about the impact on retail pricing and circulation.

Article Subheadings
1) The Cost of Minting Pennies
2) Legislative Backing for the Decision
3) Public Response and Economic Implications
4) Background on Penny Production
5) Future of U.S. Currency and Coinage

The Cost of Minting Pennies

The decision to discontinue the production of the penny stems from rapidly increasing costs associated with minting the coin. Currently, each penny costs approximately 3.69 cents to produce, a figure that has risen by 20% in 2024 alone. The U.S. Treasury estimates a total savings of $85 million by halting penny production, which, although modest compared to the broader government expenditure of $6.8 trillion in 2024, represents a proactive step in fiscal responsibility.

This notably inefficacious expenditure highlights an ongoing issue of diminishing returns in coin production. The U.S. Mint anticipates that ceasing penny minting will save approximately $56 million in material costs, with additional savings arising from operational efficiencies. Stakeholders, including retailers and consumers, are keenly watching how these changes will affect pricing structures at various levels.

Legislative Backing for the Decision

Support for the cessation of penny production has come from various political figures. On May 1, Senator Mike Lee (R-Utah) sponsored the “Make Sense Not Cents Act,” which formally aims to end penny minting. He remarked,

“No private business would produce something at a 4x loss. It’s time to stop wasting Americans’ hard-earned tax dollars making overpriced pennies.”

With growing bipartisan support for this initiative, the decision to phase out the penny appears politically sound as well as financially prudent.

Echoing calls from various economists, there is a growing sentiment that the penny has lost its functional value in modern commerce, leading to calls for similar measures affecting other low-denomination coins. The ongoing discussion underscores a larger conversation about the viability and relevance of certain currency forms in today’s digital age.

Public Response and Economic Implications

The public and business community’s reactions have been a mix of concern and acceptance. Many retailers may find the transition to a nickel-based rounding system challenging, especially those in sectors where prices are traditionally lower. For instance, small businesses often rely on pennies for pricing strategies and discount offers. Thus, the elimination of the penny could necessitate a significant recalibration of how prices are presented and calculated.

A Federal Reserve study conducted in 2022 reported that any abrupt removal of the penny might generate a rush for consumers to redeem their coins, potentially causing supply shortages and panic. The study had recommended a gradual reduction in penny production, estimating overall savings could reach $100 million over time. This nuanced understanding helps authorities navigate the complexities surrounding the decision, emphasizing careful consideration as the transition unfolds.

Background on Penny Production

Historically, pennies were primarily composed of copper until 1982 when production shifted to a zinc core with copper plating. The change was a direct response to rising material costs, reflecting broader economic trends that have impacted American currency for decades. As of now, there are approximately 114 billion pennies in circulation, with an annual production cost amounting to $192 million.

Despite the financial inefficiency of the penny, many nations have already phased out such low-denomination coins. Research indicates that in several countries, the non-utilization of pennies has not negatively impacted economic transactions. Instead, it has streamlined currency circulation by encouraging electronic payments and rounding up to the nearest usable denomination.

Future of U.S. Currency and Coinage

The initiative to stop penny production may signify more extensive changes to U.S. currency and coinage in the coming years. The focus appears to be shifting toward optimizing the currency system in response to technological advancements that favor digital transactions. Coin production lessening could push consumers and businesses further toward cashless payments and decentralized financial systems.

As government officials and financial analysts discuss these implications, stakeholders are beginning to consider what this means for the future of monetary policy in the U.S. The overall trajectory suggests a potential reduction in other lower denomination coins, challenging existing frameworks related to currency valuation and economic interaction.

No. Key Points
1 The U.S. Treasury will stop minting pennies due to rising production costs.
2 Senator Mike Lee has introduced legislation to halt penny production.
3 Public response varies, with some concerns over pricing adjustments.
4 Future monetary policies may shift further away from low-denomination coins.
5 The decision to end penny production reflects ongoing fiscal responsibility efforts.

Summary

In conclusion, the phasing out of the penny is a significant indication of evolving financial practices within the U.S. This decision, catalyzed by rising costs and legislative backing, illustrates a collective move towards more efficient monetary policy. As stakeholders adapt to this change, it will be vital to monitor its impact on pricing structures and the implications for broader currency trends.

Frequently Asked Questions

Question: Why is the U.S. government discontinuing the penny?

The U.S. government is discontinuing the penny due to rising production costs that exceed the coin’s face value, resulting in a current cost of approximately 3.69 cents per penny.

Question: What financial savings are expected from stopping penny production?

Halting penny production is expected to save the U.S. Treasury around $85 million, with significant costs saved in materials and operational efficiencies.

Question: How will businesses adapt to the elimination of the penny?

Businesses may have to adjust their pricing strategies, likely rounding prices to the nearest five cents in the absence of pennies, impacting overall sales strategies and consumer perceptions.

Congress Crime Economy Education Elections Environmental Issues Healthcare Immigration Natural Disasters Penny plans Politics production Public Policy Social Issues Supreme Court Technology Treasury White House
Share. Facebook Twitter Pinterest LinkedIn Email Reddit WhatsApp Copy Link Bluesky
News Editor
  • Website

As the News Editor at News Journos, I am dedicated to curating and delivering the latest and most impactful stories across business, finance, politics, technology, and global affairs. With a commitment to journalistic integrity, we provide breaking news, in-depth analysis, and expert insights to keep our readers informed in an ever-changing world. News Journos is your go-to independent news source, ensuring fast, accurate, and reliable reporting on the topics that matter most.

Keep Reading

U.S. News

Exploring Affordable Stocks Set for Second-Half Gains

6 Mins Read
U.S. News

Apple’s F1 Achievement Overshadowed by AI Challenges

10 Mins Read
U.S. News

International LGBTQ+ Travelers Cut Back on U.S. Trips

7 Mins Read
U.S. News

iPhone Sales in China Rise for First Time in Two Years

5 Mins Read
U.S. News

IPO Market Revitalized as Circle’s 500% Surge Signals End of VC Drought

6 Mins Read
U.S. News

CoreWeave Achieves First Deployment of Nvidia’s Blackwell Ultra

5 Mins Read
Mr Serdar Avatar

Serdar Imren

News Director

Facebook Twitter Instagram
Journalism Under Siege
Editors Picks

Booker Accuses Trump Administration of Targeting Trans Community

April 29, 2025

Trump Considers Suspending Habeas Corpus for Migrants

May 9, 2025

Musk and DOGE Team Discuss Federal Cost-Cutting Strategies in Exclusive Interview

March 28, 2025

US Anticipates Putin’s Ceasefire Proposal After Trump Call on Russia-Ukraine Conflict

May 20, 2025

House GOP Backs Trump’s DOGE Initiatives with Legislative Support

March 15, 2025

Subscribe to News

Get the latest sports news from NewsSite about world, sports and politics.

Facebook X (Twitter) Pinterest Vimeo WhatsApp TikTok Instagram

News

  • World
  • U.S. News
  • Business
  • Politics
  • Europe News
  • Finance
  • Money Watch

Journos

  • Top Stories
  • Turkey Reports
  • Health
  • Tech
  • Sports
  • Entertainment

COMPANY

  • About Us
  • Get In Touch
  • Our Authors
  • Privacy Policy
  • Terms and Conditions
  • Accessibility

Subscribe to Updates

Get the latest creative news from FooBar about art, design and business.

© 2025 The News Journos. Designed by The News Journos.

Type above and press Enter to search. Press Esc to cancel.

Ad Blocker Enabled!
Ad Blocker Enabled!
Our website is made possible by displaying online advertisements to our visitors. Please support us by disabling your Ad Blocker.