Trump’s abrupt phase-out sparks confusion across economy
The United States is grappling with the consequences of an unexpected shortage of pennies following the Trump administration’s decision earlier this year to stop minting the coin. With no formal phase-out or guidance, retailers, banks, and consumers are navigating the fallout with growing frustration.
Merchants across the country have run out of pennies, making it difficult to provide exact change. Banks are rationing limited supplies and can no longer order more. Convenience store chain Sheetz even launched a promotion offering free sodas to customers who brought in pennies. Others, like Kwik Trip, are rounding down cash transactions to avoid legal complications, a move expected to cost millions.
Production halted, but circulation problems persist
The U.S. Mint stopped penny production in June after exhausting its final shipment of copper-zinc planchets. In total, 3.23 billion pennies were produced in 2024, making it the most minted coin that year. But pennies rarely re-enter circulation due to hoarding and logistical bottlenecks. The Federal Reserve reports that nearly a third of coin terminals now refuse both penny deposits and withdrawals, worsening regional disparities in availability.
Treasury Secretary Scott Bessent estimated that ending penny production will save the government $56 million annually. Yet the abrupt implementation, with no congressional or regulatory framework, has sparked operational and legal chaos, particularly during the busy holiday shopping season.
Retailers face legal and financial fallout
Retailers are legally constrained in some states from rounding prices up, leaving them no choice but to round down, impacting their bottom line. While two or three cents per transaction may seem minor, the cumulative effect is substantial. Kwik Trip alone anticipates a $3 million loss in 2025 due to the issue.
Many businesses are urging customers to pay in exact change or donate spare change to charity. A bill known as the Common Cents Act, currently pending in Congress, proposes rounding all cash transactions to the nearest nickel. However, it remains unclear if or when such legislation will pass.
Lack of federal guidance draws criticism
Industry groups including the National Retail Federation and the National Association of Convenience Stores say they support the end of the penny but criticize the lack of a transition plan. Other countries, such as Canada and the U.K., implemented gradual transitions over several years. In contrast, the U.S. cut off production abruptly and offered no roadmap for managing the change.
“We don’t want the penny back. We just want some sort of clarity from the federal government on what to do,” said Jeff Lenard of NACS. Without guidance, stakeholders warn that penny-related disruptions could worsen in the months ahead.
