The U.S. Treasury Department has announced plans to discontinue the production of the penny, marking the end of over two centuries of minting the one-cent coin. The decision comes as the cost to produce a single penny has risen to nearly four cents, leading to significant financial losses. By ceasing production, the government anticipates saving approximately $56 million each year.
The final order for penny blanks has been placed, and the U.S. Mint will continue producing pennies until the current supply is exhausted, expected by early 2026. With approximately 114 billion pennies already in circulation, the coin's usage has declined, and many end up unused or discarded.
Following the phase-out, cash transactions will be rounded to the nearest five cents, while electronic payments will remain unaffected. This move aligns the U.S. with countries like Canada and Australia, which have already eliminated their lowest-denomination coins due to similar cost concerns.
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