Australia's five-cent coin at risk of being discontinued due to inflation

GMT 13:54 2016 Tuesday ,03 May

Arab Today, arab today Australia's five-cent coin at risk of being discontinued due to inflation

Australian five-cent coin
Canberra - XINHUA

Australia's smallest denomination of currency is under threat of being discontinued, after it was revealed it costs more to make the Australian five-cent coin than it is worth.

Just over 50 years since it was introduced into circulation, the coin now costs six cents to produce, the Australian mint said, meaning its days are numbered as a form of currency.

Many Australian vending machines and businesses already refuse to accept the coin, while cashless payments and inflation have already helped render the nation's smallest coin almost redundant.

The coin could be put to bed permanently when the government announces the federal budget on Tuesday evening, with many reports suggesting the mint would stop producing the coin, which features Queen Elizabeth II on the back and a baby echidna - a native Australian animal - on the front.

It would result in a gradual phase out, similar to the discontinuation of the one- and two-cent coins in 1992. Those two coins - made of copper - stopped being produced in 1990 after the government issued a similar announcement in that year's budget.

The Australian dollar and its many denominations were introduced in 1966, when Australia dumped the pound and shilling for a metric dollar system. Along with notes varying from five dollars up to 100 dollars (75 U.S dollars) - all of which are still in circulation - the currency came with one- and two-dollar coins, as well as 50, 20, 10, five, two and one-cent pieces.

Australian Mint chief executive Ross MacDiamid said the five-cent piece would go the way of the one and two cent pieces - with the likely announcement to come in coming days.

"We've seen a halving of the demand for five-cent pieces over the past five years and our expectation is that it will just simply progress," MacDiamid said.

"It's lost its utility; it will lose interest from the public."

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