First came a shortage of toilet paper, hand sanitizer and household disinfectants.
And now? A temporary scarcity of change — pennies, nickels, dimes and quarters.
Multiple businesses in the Lima area posted signs this week asking customers to pay in exact change or use debit or credit cards for their purchases. Others marked some registers for credit and debit transactions only, sending all cash transactions through common lanes.
Federal Reserve Chair Jerome Powell this month told the U.S. House Financial Services the shortage was due to fallout from the COVID-19 pandemic.
“What’s happened is that, with the partial closure of the economy, the flow of coins through the economy has gotten all … it’s kind of stopped,” Powell said during a virtual hearing with the committee.
The Federal Reserve, in a news release, said coin production was down at the U.S. Mint due to precautionary measures taken to protect workers from the COVID-19 virus. That reduced the supply of coins to some banks and also to businesses.
The Fed in June announced a “strategic allocation of coin inventories,” stating the pandemic has “significantly disrupted the supply chain and normal circulation patterns for U.S. coin. In the past few months, coin deposits from depository institutions to the Federal Reserve have declined significantly, and the U.S. Mint’s production of coin also decreased due to measures put in place to protect its employees.”
While the U.S. Mint cut production in April and May, retailers were also ordering more coins as they were getting less coins as people stayed home.
While the mint returned to full production by mid-June, the temporary reduction in the supply of coins is still impacting some businesses.