The Central Bank has dismissed the idea of phasing out the one and two cent coins in Ireland as a "silly season" story that isn't being given any consideration at present.

The statement comes after the Bundesbank, the German central bank, announced yesterday that it is considering eliminating use of the smaller copper coins, partly due to rising steel prices and transport costs. Finland has already stopped using the coins and the Netherlands and Belgium are considering following suit.

A spokeswoman for the Central Bank said that contrary to the impression given in some reports, the coins were not actually being done away with in these countries.

"Some of the euro zone countries are operating a voluntary system, where the final bill for a product or service is rounded up, rather than the prices of individual items," she said.

"The coins are still being produced and they are still legal tender. It's the customer's choice and if you demand to deal in one cent coins, the retailer has to oblige.

"It's a decision for the European Commission but I believe they are not discussing any similar plans for Ireland."

The Consumer's Association of Ireland has warned that any such move would be a burden on both consumers and retailers.

"I know people will say it's only a few cent here or there, but history shows that prices will be rounded up rather than down. We're already bordering on having the highest cost of living in the euro zone and this would only bury us in a deeper pile of trouble," said chief executive, Mr Dermott Jewell.