The COVID-19 pandemic has significantly interrupted many aspects of daily life. It seems like every month we are faced with a new challenge to overcome, not only in our personal lives but also as a community. Recently, signs have been appearing at businesses around the country requesting electronic payment or the use of exact change for purchases. This has sparked several questions about what is happening regarding the coin supply.
First, it is important to know the process in which coins are distributed. The U.S. Mint is the issuing authority for coin. The Federal Reserve manages coin inventory and they distribute to depository institutions, including community banks, through Reserve Bank cash operations and offsite locations across the country operated by Federal Reserve vendors.
Over the course of this year, coin deposits from depository institutions to the Federal Reserve declined, in addition the U.S. Mint’s production of coin decreased due to measures put in place to protect its employees during the pandemic. As states begin to open, the Federal Reserve has started to see an increase in coin orders from depository institutions; this has resulted in the Federal Reserve’s coin inventory being reduced to below normal levels.
The Federal Reserve is currently working to manage the low coin inventory. This includes managing the allocation of existing inventory, working with the Mint to minimize coin supply restraints, maximize coin production, and allowing depository institutions to order only the coin they need to meet short-term customer demand.
We are very fortunate to live in communities where people seek out ways to help during difficult times. One thing you can do to help is to deposit or cash-in extra change. All of NebraskaLand Bank locations are equipped with coin sorters and would be happy to help you.
References
Strategic Allocation of Coin Inventories