US Tariffs: Third Spike for Polished Diamond Prices

(IDEX Online) - Real-time asking prices for polished diamonds have spiked for a third time in direct response to US tariffs.

They surged by around 3.8 per cent between 8 and 10 September, then slumped by 4.2 per cent over the next two days, according to the IDEX Online Diamond Index.

This was a delayed reaction to the imposition on 27 August of an additional 25 per cent in US tariffs on goods from India, as a punishment for buying Russian oil.

Exporters rushed to ship goods before the tariff deadline, creating short-term market distortions and inventory backlogs that took time to resolve.

The actual price spike on September 10 aligned with market sentiment shifts as traders adjusted pricing to reflect the new tariff reality, inventory realignments, and buyers gradually absorbing higher costs.

The first tariff-related spike - up 6.9 per cent - was 25 to 27 June, ahead of what was supposed to be the 9 July imposition of reciprocal tariffs, although President Trump then announced a last-minute postponement.

Buyers rushed to place and ship orders to the US to avoid the coming tariff, leading to a brief but intense surge in trading volume and prices.

The second spike -up 6.7 per cent - was between 30 July and 7 August, the day when reciprocal tariffs came into force globally. Manufacturers in India responded to the 25 per cent tariffs by making last-minute emergency shipments. This created a steep, short-lived upward movement in the Index.

On both occasions the Index fell sharply in subsequent days as the markets corrected.

The Index has shown steep surges in the recent past, most notably in late 2021 to early 2022 (the beginning of the end for Covid) but they were part of a strong upwards trend rather than a short-term spike.

The IDEX Online Diamond Index monitors and aggregates listings from a vast network of suppliers to objectively reflect current market sentiment and asking prices.

Pic shows three spikes in the IDEX Online Diamond Index.