Penny Production Halted; Will Stop Entering Circulation in 2026

When people start leaving a monetary unit at the cash register for the next customer, the unit is too small to be useful.

Harvard economics professor Gregory Mankiw, commenting on the usefulness of the penny as the Treasury Department announces plans to halt production of the penny early next year.

Why It Matters: The Treasury Department will begin phasing out the penny in 2026 and predicts $56 million in annual savings due to reduced material costs, according to the WSJ article. The penny costs nearly four cents to make. Calls to stop penny production have come from both sides of the aisle.

• Back in February, President Trump posted on Truth Social saying, “For far too long the United States has minted pennies which literally cost us more than 2 cents. This is so wasteful! I have instructed my Secretary of the US Treasury to stop producing new pennies.”
• Roughly $14 billion in coins sit in coin jars, according to the Federal Reserve.
• Businesses will likely be required to round prices up or down.
• Americans will still be able to use their pennies even after production stops.
• Canada stopped production of its penny in 2012 and now rounds transactions up to the nearest five cents.

History of the U.S. Penny:

• The U.S. Mint is responsible for producing U.S. coins. In 1792, the penny became one of the first coins made.
• The first penny featured a woman with flowing hair, symbolizing liberty, and stayed in circulation for more than 60 years with its pure copper composition and slightly larger design. In 1857 to 1859, the penny featured an eagle on one side and a wreath on the other. The “Indian Head” design was in production from 1859 to 1909.
• In 1857, the penny got smaller and evolved to a composition of copper and nickel. In 1866, the composition changed to copper, zinc and tin, and then to copper and zinc in 1965.
• Abraham Lincoln became the first president featured on a U.S. coin in 1909 to honor his 100th birthday. While the U.S. still uses the same design on one side of the penny, the reverse design has changed over the years.
• Unusual pennies have emerged throughout U.S. history, such as in 1943 when pennies were made of zinc-coated steel since copper was needed for military efforts in World War II.
  

Read More: Treasury Sounds Death Knell for Penny Production (Wall Street Journal)

The Treasury unveils its plan to kill the penny (CNN)

United States Mint: History of the Penny