There’s a coin shortage in the US.
Banks and businesses have shuttered or changed the way they operate. And so there are fewer coins reaching the public.
«In a time when pennies are the difference between profitability and loss, it seems like it might be a bigger concern than the announcement from the Fed would indicate that it is,» Rose said.
What’s being done
To mitigate the coin shortage, the Federal Reserve Banks began the «strategic allocation of coin inventories» this week to evenly distribute coins across banks and credit unions. Those «strategic allocation» measures include imposing order limits based on the historic order volume of those coins and how many coins the US Mint is currently producing.
In the meantime, the Federal Reserve is working with the Mint to produce more coins and lift supply constraints. The Reserve encourages institutions to order only the amount of coins they need to meet customer demand in the short term.
«Although the Federal Reserve is confident that the coin inventory issues will resolve once the economy opens more broadly and the coin supply chain returns to normal circulation patterns, we recognize that these measures alone will not be enough to resolve near‐term issues,» the Reserve Banks statement said.
Federal Reserve officials believe the shortage is temporary, Powell said.
«As the economy reopens, we’re seeing coins begin to move around again,» he said.