but no longer produced.

Brazil, Finland, Israel, Norway, Sweden, and Switzerland have also withdrawn lowdenomination coins from circulation.

A Penny for Your Thoughts

While opinion polling on this issue is minimal, the available research suggests mixed views about the low-value coin.

A recent National Association of Convenience Stores poll found that more than one-third (36 percent) of consumers favored eliminating the penny.

According to a 2019 Americans for Common Cents survey, more than two-thirds (68 percent) favored keeping the penny in circulation. The pro-cent organization also found that 64 percent opposed abolishing the penny and installing a price rounding system.

A 2020 Federal Reserve Bank of Richmond paper suggested that killing the penny would most affect the impecunious.

“Low-income consumers stand to be most affected by the change because they are more likely to be unbanked and reliant on cash for transactions,” the regional central bank wrote. “In the short term, at least, merchants might round purchases for customers paying in cash but not for those paying with card, potentially disadvantaging consumers who have no choice but to pay in cash.”

Additionally, a widely shared 2001 paper by a Penn State University economist discussed a “rounding tax.” If merchants added a couple of extra cents to prices, consumers would be hit with about $600 million annually, which would have a greater impact on low-income households.

However, a 2023 Federal Reserve Bank of Atlanta study concluded that rounding prices to the nearest nickel would unlikely generate “any significant inflationary consequences.”

In the Nickel of Time Could the nickel be the next target for the administration?

It costs 13.8 cents to manufacture a five-cent nickel. The U.S. Mint says that 11 cents are dedicated to production costs, and the remaining 2.8 cents are allocated to administrative and distribution costs.

If the White House follows through on phasing out the penny, the United States will likely need to increase the volume of nickels in circulation to offset the loss of the penny. Ultimately, it might cost more to eradicate the one-cent coin and ramp up the output of five-cent nickels.

Although payment apps and credit cards are prevalent for transactions, many consumers depend on cash, a growing preference in today’s hyper-digital marketplace.

A 2023 survey by the Atlanta Fed discovered that almost 90 percent of consumers used cash, and one-quarter of inperson purchases were completed with physical money.