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 US has minted pennies which accurately value us greater than 2 cents,” Trump mentioned 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 funds, 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 keeping 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 difficulty cash as obligatory for the wants of the US.
However at the very least one analyst on Wall Road expects that the penny’s days are numbered. TD Cowen’s Jaret Seiberg mentioned the halt will possible cross judicial evaluation, resulting in a scarcity of the coin.
“We consider this order would survive judicial evaluation, which is why that is more likely to happen,” Seiberg wrote Monday. “We fear about this resulting in a scarcity of pennies, which may power retailers to pay banks extra for cash. It additionally provides authorized threat for retailers and banks. That would create the disaster wanted to power Congress to behave.”
Seiberg mentioned he expects this might help the transfer towards digital funds, bolstering corporations comparable to Visa, Mastercard and different real-time fee networks.
What is obvious 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, based on an annual report. That meant the price of every penny has run above its face worth for a nineteenth straight fiscal 12 months.
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.
