prices for certified diamonds showed a weakening, as large centers of faceting faced a difficult financial situation, according to a Rapaport press release. The stable demand for diamonds from the US supports the market, but due to the fall in the Indian rupee and the lack of liquidity, as well as the weakening demand for diamonds in India and China, trade activity has slowed.
The sharp depreciation of the rupee, whose exchange rate against the US dollar fell to a record low (Rs 60 per dollar), undermined Indian interest in diamonds.
In June, the price index RapNet (RAPI ™) for certified diamonds weighing one carat decreased by 0.6%. RAPI for stones weighing 0.30 carats fell by 1%, showing a change in the trend for price increases in this product category, which was observed in the first five months of the year. The RAPI index for stones weighing 0.50 carats decreased by 0.7%, and RAPI for stones weighing 3 carats fell by 0.5%.
As noted in Rapaport's monthly market report for July 2013, entitled Reasonable Caution, in June, market participants showed conservatism and diamond prices were still under pressure.
About 25,000 diamond cutters in Surat lost their jobs, as the weakening of the rupee forced diamond producers to stop buying rough diamonds at unsustainable prices. In addition, the retail jewelry market in China was quiet, which was accompanied by a weakening of demand in the entire Far Eastern region.