IDEX Polished Price Index: The Decline Continues in August

(IDEX Online) - The IDEX Polished Price Index suffered another month of steady decline during August, down by 2.31 per cent. That's the biggest monthly drop since it began falling in early March. It was down 2.1 per cent in April, 0.69 per cent in May, 1.18 per cent in June and 2.05 per cent in July. January and February, by comparison, showed sharp increases, up by 5.67 per cent and 4.14 per cent respectively. 

The longer-term graph below shows the Index still in significant decline since it peaked in March of this year. Its average value through August was 144.02. In July it was 147.59, down from June (150.01), May (151.28) and April (153.30) The Index had been gradually declining since mid-2018 to a low point in April 2020, when the first lockdowns hit. The overall trend since then had been upwards.

Month-to-month diamond prices were down 2.4 per cent in August, the biggest fall in almost four years. They fell 1.6 per cent in July and 0.8 per cent in June. Monthly price increases peaked in February, before Russia invaded Ukraine, at 6.2 per cent and have been in negative growth since April.

Year-to-year polished diamond prices showed slower growth for a fifth consecutive month in August. At 10.0 per cent it was the lowest figure so far of 2022.  Growth has been steadily slowing each month since it peaked in March of this year at 27.9 per cent. The figure for July was 13.7 per cent, down from 17.5 per cent in June and 21.1 per cent in May. The overall trend had been upwards since the depths of the pandemic in April 2020, albeit with a dip last September and October.

Polished month-on-month prices for all key sizes shown below fell again in August. Average losses were greater than in July.  Price drops for every size shown were greater in July than in June. Price drops in August were most significant among 0.50-cts and 1.00-cts goods - 3.2 per cent and 3.3 per cent respectively. Losses in August were greater for all sizes shown, except 3.0-cts.

Year-on-year polished prices were still increasing in August, for all sizes shown below, except 0.50-cts goods, but at a slower rate than in July. And July in turn, saw slower growth than in June. The highest increase was among 2.0-cts goods, up 17.6 per cent year-on-year and the poorest performance was a 3.0 per cent drop among 0.50-cts.

Prices for all sizes shown below continued their steadily decline in August. They peaked in March after many months of significant increases but fell sharply in April and have carried on falling ever since.

 Assessment: The IDEX Polished Price Index has now been declining for almost five months, and shows no signs of slowing down. In fact, it's now falling faster than at any time in almost four years. The decline began in the first week in March, days before the US imposed sanctions on Russia over its invasion of Ukraine. Underlying that decline has been the end of most Covid restrictions and the emergency funding poured into economies by governments. Consumers who spent their available cash on jewelry during the pandemic can now travel freely and spend freely on whatever they want.

Prices for most polished diamond sizes shown remain higher than they were at this time last year, but month by month they are falling, by as much as 3.3 per cent.