In a recent move to reduce government spending, President Trump has directed the Treasury Secretary to cease the production of new one-cent coins. The decision comes amid concerns over rising costs associated with minting pennies, which have become increasingly expensive to produce.
According to the U.S. Mint, it currently costs approximately 3.7 cents to produce a single penny, leading to a loss of about $85.3 million in the fiscal year 2024 alone. The composition of the penny, primarily zinc with copper coating, contributes to these high production costs.
This move aligns with the administration’s broader efforts to eliminate wasteful government expenditures. However, some critics express concerns that eliminating the penny might lead to increased production of nickels, which are also costly to mint.
The U.S. now joins countries like Canada and Australia, which have successfully phased out their lowest-denomination coins without significant public backlash. The administration has yet to detail the next steps following this order, including how existing pennies in circulation will be managed.
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