Coin shortage hits United States

Coin shortage hits United States

The coronavirus has made adjustments to traditional cash flows. The amount of electronic transactions is growing rapidly, while cash is gradually becoming history. At the time when paper money is still in use, the circulation of coins has almost completely ground to a halt. American banks were among the first in the world to face a shortage of coins. "We are working with the mint and we are working with the reserve banks. And as the economy reopens, we’re seeing coins begin to move around again," reassured Federal Reserve Chairman Jerome Powell. However, Powell’s statement failed to convince everyone. Thus, John Rose, a congressman from Tennessee, told Powell that in his district the bank had coins left at least for a week. Rose also blamed the Fed’s officials who cut the supply of coins by half. "We all don't want to wake up to headlines in the near future such as 'Banks run out of money,'" said the congressman.

Jerome Powell, in his turn, declared that coinage shortage was a temporary phenomenon which appeared as a result of several factors. Firstly, it was caused by an overall decrease in cash payments. Secondly, the American Mint had cut the production of coins due to measures taken to protect its employees during the corona crisis. Nevertheless, in the near future, the mint should increase coin manufacturing, and the problem should be solved.


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