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 mentioned will assist cut back “wasteful” authorities spending.
“For a lot too lengthy the USA has minted pennies which accurately value us greater than 2 cents,” Trump mentioned in a Fact 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 funds, even when it is a penny at a time,” Trump wrote.
It isn’t clear whether or not the president has the authority to cease the manufacture of the 1-cent coin. Based on the U.S. Structure, coinage energy, as acknowledged by the Supreme Courtroom, is “unique” to Congress. Federal legislation says the Treasury secretary can mint and concern cash as needed for the wants of the USA.
However not less than one analyst on Wall Avenue expects that the penny’s days are numbered. TD Cowen’s Jaret Seiberg mentioned the halt will doubtless go judicial overview, resulting in a scarcity of the coin.
“We consider this order would survive judicial overview, which is why that is prone to happen,” Seiberg wrote Monday. “We fear about this resulting in a scarcity of pennies, which may pressure retailers to pay banks extra for cash. It additionally provides authorized threat for retailers and banks. That would create the disaster wanted to pressure Congress to behave.”
Seiberg mentioned he expects this might help the transfer towards digital funds, bolstering firms akin 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 line with an annual report. That meant the price of every penny has run above its face worth for a nineteenth straight fiscal yr.
The most recent U.S. Mint report suggests the nickel higher watch its again, too. Every 5-cent piece prices the Mint 13.78 cents to make.
