President Donald Trump said he ordered the Secretary of the Treasury to stop new cents, in a publication on his social truth platform on Sunday night, citing the cost of production of the currency, which has been higher than its nominal value For almost two decades.
Key data
In its publication Truth, Trump wrote that the United States has coined cents that “literally cost us more than 2 cents” for “too much time” and added: “This is a great waste!”
The president said he has instructed “my secretary of the United States Treasury” to stop its production and suggested that it is a measure to reduce waste in the country’s budget “even if it is a penny at the same time.”
Trump’s announcement occurs just a few weeks after the government efficiency department led by Elon Musk raised the high cost of manufacturing cents in an X post.
However, it is not clear if Trump can act unilaterally to stop the production of the currency or if he would require a congress legislation, as happened with the discontinuation of the penny medium in 1857.
How much does it cost to make a penny?
In its annual report of 2024, the United States Mint said that each penny costs 3.69 cents to manufacture, more than three and a half times the nominal value of the currency. The Mint said that the cost of producing the currency of a penny “remained above the nominal value for nineteenth consecutive fiscal year.” The United States Mint lost $ 85.3 million in the production of cents in fiscal year 2024, which ended in September last year. The currency of a penny accounted for 54% of the 5.87 billion currencies produced by the Casa de la Moneda during this period.
Is there any other currency that costs more than its nominal value?
The five cents or Nickel also costs more than its nominal value. According to the United States Currency House, manufacturing each Nickel would cost 13.78 cents in fiscal year 2024. In total, La Casa de la Moneda lost $ 17.7 million in Nickels production last year.
What to keep in mind
It is not clear how Congress will respond to Trump’s decision to suspend the mint of cents. Even if the measure obtains the support of both cameras controlled by the Republican Party, legislators will probably have to approve legislation on cash transactions that are not divisible by the immediately lower denomination: the five cents currency. In previous legislative initiatives, prices have been requested to be rounded up or down to the cent you of five closer.
Main critic
Americaons for Common Cels, a group that has pressed to continue to produce cents, opposed Doge’s publication at the end of last month, saying that “it does not give in the target.” The group argued that “although the cost of production of the penny exceeds its nominal value, the real culprit of losses is nickel, whose production costs almost 14 cents per unit. By eliminating the penny, the house of the currency inevitably would need to produce more nickel coins, which would aggravate the losses associated with nickel production. ” The group’s executive director, Mark Weller, has previously confirmed that Artazn, the company that sells zinc cospeles to the United States Mint for the production of cents, is one of its sponsors.
This article was originally published by Forbes Us.
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