There is a Nationwide Coin Shortage

Speaking Wednesday before the House Financial Services Committee, Federal Reserve Board Chairman Jay Powell reported a coin shortage in the country.

“With the partial closure of the economy, the flow of coins through the economy has gotten all…it’s kind of stopped,” Powell said. “We are well aware of this and are working with the Mint and we are working with the reserve banks. And as the economy reopens, we are seeing coins begin to move around again.

On Monday, the Fed said in a press release that coin production and distribution activities had been significantly hampered by the coronavirus lockdowns, leading to a de facto rationing of what banks could obtain for their customers, reports The Wall Street Journal. Although production has been curtailed, demand has been rising as the nation reopens, which has led to the shortage, the Fed said.

This is certainly not a crisis that will bring the economy to its knees but it does point to my earlier warning that there are likely to be supply disruptions in the economy because of the lockdowns that are not immediately evident--some of which could be more serious than a coin shortage.

-RW