U.S. President Donald Trump meets with Japan’s Prime Minister Shigeru Ishiba (not pictured) on the White Home in Washington, U.S., Feb. 7, 2025.
Kent Nishimura | Reuters
President Donald Trump ordered a halt to the manufacturing of latest pennies, which he stated will assist scale back “wasteful” authorities spending.
“For much too lengthy the USA has minted pennies which accurately value us greater than 2 cents,” Trump stated in a Reality Social publish. “That is so wasteful! I’ve instructed my Secretary of the US Treasury to cease producing new pennies. Let’s rip the waste out of our nice nations finances, even when it is a penny at a time,” Trump wrote.
It is not clear whether or not the president has the authority to cease the manufacture of the 1-cent coin. In accordance with the U.S. Structure, coinage energy, as acknowledged by the Supreme Court docket, is “unique” to Congress. Federal regulation says the Treasury secretary can mint and challenge cash as mandatory for the wants of the USA.
However at the very least one analyst on Wall Road expects that the penny’s days are numbered. TD Cowen’s Jaret Seiberg stated the halt will doubtless move judicial evaluate, resulting in a scarcity of the coin.
“We consider this order would survive judicial evaluate, which is why that is more likely to happen,” Seiberg wrote Monday. “We fear about this resulting in a scarcity of pennies, which may drive retailers to pay banks extra for cash. It additionally provides authorized danger for retailers and banks. That might create the disaster wanted to drive Congress to behave.”
Seiberg stated he expects this might assist the transfer towards digital funds, bolstering firms similar to Visa, Mastercard and different real-time cost networks.
What is evident is that pennies value extra to make than they’re price. In 2024, the U.S. Mint spent 3.69 cents to fabricate every penny, in keeping with an annual report. That meant the price of every penny has run above its face worth for a nineteenth straight fiscal 12 months.
The newest U.S. Mint report suggests the nickel higher watch its again, too. Every 5-cent piece prices the Mint 13.78 cents to make.
