Rounding Up: The Impact of Phasing Out the Penny

Federal Reserve Bank of Richmond

Published: July 1, 2025

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Source Overview

Economic modeling examines the consumer and business impact of rounding cash transactions.

Key Takeaways

Rounding effects on consumers are minimal
Treasury savings exceed rounding costs
Nickel elimination would have larger effects

Our Two Cents

Economic data suggests penny elimination is net-neutral for consumers if rounding remains symmetrical.

Open Questions

?How should rounding neutrality be monitored?
?Are safeguards needed for cash-dependent populations?

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