The Royal Mint announced Friday it will stop making the one-cent coin.
Federal Finance Minister Jim Flaherty is set to take part in a ceremonial coin strike Friday morning at the mint’s coin production facility in Winnipeg, to mark the end of production of the penny.
Once the very last penny is produced it will reside in a museum. Early this year in March, Flaherty announced in the federal budget that the penny would be eliminated from Canada`s coinage system. Rising production costs (medal to produce the penny costs 1.6 cents per penny) and lower purchasing power were cited as reason for this decision.
The Canadian government will phase the penny out starting this fall, when the mint will stop distributing the coin to financial institutions. Businesses are expected to start applying rounding their cash transactions. The government noted that the one-cent coins will always be accepted in cash transactions for as long as people are holding on to them.