You’ve seen the signs, and yes, the U.S. is experiencing a coin shortage.
“It is real,” said Kim Marshall, president of Central Bank’s Georgetown branch, about the coin shortage.
Like most everything else, the COVID-19 pandemic has disrupted normal life, including the typical flow of coins through the U.S. economy. As a result, major retailers like Lowe’s have gone to credit-only cash registers, and Kroger has stopped giving change, assigning that change to their Kroger card.
“COVID-19 has significantly disrupted the supply chain or normal circulation patterns for coins,” Marshall said. “The U.S. Mint’s production of coin was reduced due to measures put in place to protect employees.
“As well, bank customers weren’t bringing in their ‘piggy banks’ of coins to cash in for vacation because some bank lobbies remain closed to customer access, etc. So it was a perfect storm.”
Federal Reserve chairman Jerome Powell told the House Financial Services Committee on June 17 the pandemic shutdown influenced the coin shortage.
“With the partial closure of the economy, the flow of funds through the economy has stopped,” Powell said. “We are working with the Mint and the Reserve Banks, and as the economy re-opens, we are starting to see money move around again.”
A June 11 news release from the Federal Reserve noted coin deposits had declined and the U.S. Mint reduced its coin production. At that time, banks were allocated coins based upon their historical coin orders in an effort to manage inventory. Later, the U.S. Mint returned to full staffing to “maximize coin production.”
While the coin shortage is easing, federal officials estimate the problem won’t be resolved until the economy is fully functioning again.
“We are seeing a slight improvement currently, but the Fed is still managing allocation of distribution to banks,” Marshall said. “We would encourage people to bring in their buckets of coin so we can ship it to the Fed to put back into circulation.”
Mike Scogin can be reached at firstname.lastname@example.org.