Pennies are being minted at a loss to the US taxpayer equaling millions of dollars per year. Abolishing the penny (as Canada has) and round transactions to the nearest 5 cents would save the government money on manufacturing but could cost consumers as merchants begin rounding prices up.
Economist François R. Velde's solution is to revalue the penny at 5 cents. Then, the government would make a profit minting pennies, nickels could stop being minted at a loss, and the adjusted value would mostly go to the poor more than offsetting the "rounding tax."
Lastly, with the impact on inflation is negligible.
Sources:
http://www.nytimes.com/2007/02/01/business/01scenes.html?_r=0
http://en.wikipedia.org/wiki/Penny_debate_in_the_United_States