In a surprise announcement, US President Donald Trump said on Sunday that he has directed the US treasury department to stop minting new pennies, citing the rising cost of producing the one-cent coin. The move is part of his administration’s broader push to cut government expenses.
“For far too long the United States has minted pennies which literally cost us more than 2 cents. This is so wasteful!” Trump wrote on his Truth Social platform. “I have instructed my secretary of the US treasury to stop producing new pennies.”
Trump’s decision marks the latest in a series of rapid-fire actions by his new administration, which has been aggressively pursuing sweeping changes through executive orders and proclamations. These initiatives have spanned various issues, including immigration, gender and diversity policies, and even renaming geographic landmarks like the Gulf of Mexico.
Although Trump did not address the penny’s future during his campaign, the idea gained traction after Elon Musk’s department of government efficiency (DOGE) highlighted the coin’s production costs in a post on X last month. The US Mint reported an $85.3 million loss in the 2024 fiscal year from producing nearly 3.2 billion pennies, with each coin costing nearly 3.7 cents to manufacture up from 3.1 cents the previous year.
The Mint also faces losses on other denominations, such as the nickel, which costs nearly 14 cents to produce despite its face value of just 5 cents.
Legal experts are debating whether Trump has the authority to eliminate the penny unilaterally. Currency specifications, including coin composition and size, fall under Congressional jurisdiction. However, Robert K Triest, an economics professor at Northeastern University, suggested there might be room for executive action.
“The process of discontinuing the penny in the US is a little unclear. It would likely require an act of Congress, but the Secretary of the Treasury might be able to simply stop the minting of new pennies,” Triest said.
Over the years, members of Congress have introduced various bills aimed at phasing out the penny. These proposals have included temporary suspensions, outright elimination from circulation, and mandates for rounding prices to the nearest five cents, according to the Congressional Research Service.
Supporters of eliminating the penny argue that it would result in significant cost savings, faster transactions at cash registers, and alignment with global practices. Countries like Canada successfully discontinued their one-cent coins, with Canada halting penny production in 2012.
This wouldn’t be the first time the US has phased out a low-value coin. The half-cent coin was discontinued in 1857 by an act of Congress.
Trump’s administration, focused sharply on cost-cutting measures, has tasked Musk with identifying up to $2 trillion in federal savings. This effort includes scrutinising entire government agencies and federal workforce expenditures.
“Let’s rip the waste out of our great nation’s budget, even if it’s a penny at a time,” Trump posted, sharing the message shortly after leaving New Orleans, where he attended the first half of the Super Bowl.
