Silver Pennies

The penny seems to have been the common currency throughout northern Middle-earth. It was known at least as far back as Fram's time, more than five centuries before the War of the Ring, and continued in use into the Fourth Age. Pennies were used in the Shire, and also in Bree, but in most cases the word is used merely to refer to a trifling amount of money. Only in one case - the purchase of the pony Bill from Bill Ferny in Bree - do we actually see the currency in action. The weak and underfed pony was said to have been worth four silver pennies, though its owner in fact charged three times that amount.

If four silver pennies would purchase a pony, then each coin must have had more than a trivial value (and we're also told that a sum of thirty silver pennies was a substantial amount, even to the comparatively wealthy Barliman Butterbur). Given other references to pennies as minor coins, it seems that there must have been at least two types of currency in use: valuable silver pennies, and lesser pennies made of some cheaper metal (which is never specified, but would most likely have been copper or brass).

We know that there were also gold coins in use in Middle-earth. For example, Bilbo and his companions discovered pots of golden coins in a Troll-hole on their journey to Erebor. These coins are never named, and indeed we cannot be sure whether they were still being minted in the later years of the Third Age.