Diamond News Archives

(IDEX Online) – The Indian government has raised the import duty on cut and polished diamonds and processed colored gemstones to 7.5 percent from 5 percent. <?xml:namespace prefix = "o" ns = "urn:schemas-microsoft-com:office:office" /?>

The same tax hike applies to semi-processed, half cut or broken diamonds and lab-grown stones.

The government said the move was aimed at attempting to reduce India's current account deficit.

Gem and Jewellery Export Promotion Council (GJEPC) Chairman Pramod Kumar Agrawal said the huge Indian diamond and gemstone manufacturing and jewelry industries would be hit by the tax increases.

He said that a large volume of cut and polished diamonds, both loose and set in jewelry, are imported for re-setting in new designs.

The tax hikes would give an advantage to the country's main competitors.

The GJEPC would convey its concerns to the government in a bid to reduce the impact on its diamond, gemstone and jewelry exports.

India exported around $23 billion of cut and polished diamonds in the last fiscal year, and close to $10 billion worth of plain and precious stone set jewelry....

Gold traded either side of unchanged last night in a range of $1180.90 - $1185.55, attempting to consolidate after its $20 selloff over the past two sessions.

Gold advanced to its $1185.55 high during Asian hours from some bargain hunting buying as the dollar slipped to 94.92.

The yellow metal showed resiliency during European time, only dipping to $1180..90 despite a sizeable run up in the dollar (DX found buying over its triple top at 95 to reach 95.37).

The greenback was boosted by a plunge in the euro ($1.1650 - $1.1570, 2-week low) as Italy approved a much higher than expected budget deficit of 2.4% (defying European demands) and Eurozone Core CPI missed expectations.

Global equities were mixed with the NIKKEI up 1.4%, the SCI up 1.1%, European markets were off from 0.2% to 0.7%, and S&P futures were off 0.3%.

At 8:30 AM, slight misses on US Personal Income (0.3% vs. exp. 0.4%) and Core PCE (0 vs. exp. 0.1%) pushed S&P futures lower (-12 to 2908), and tugged the US 10-year bond yield down from 3.041% to 3.03%.

The DX pulled back to 95.21, and gold moved higher. The yellow metal took out last night’s high to reach $1186.50.

Weaker reports later in the morning on the Chicago PMI (60.4 vs. exp. 62) and the University of Michigan Sentiment (100.1 vs. exp. 100.5) knocked the DX further to 94.99 by mid-day.

The DX was also pressured by a rebound in the euro ($1.1629) from a modest lessening of concerns over the Italian budget situation as Italian stocks pared some losses and the 10-year Italian 10-year bond yield pulled back from 3.26% - 3.14%.

Gold tripped buy stops over the previous key support levels at $1187 (50%...

Gold has a bad reputation among some investors. The shiny metal has long been seen as “the investment choice of the cranky and the fearful”, says Andrew Bary in Barron’s. It yields nothing, and in the words of Warren Buffett, it just “looks at you”. It has certainly fallen out of favour this year. The price has fallen by 11.2% since 22 January to just under $1,200 an ounce – that’s more than 35% below its peak of $1,900 in 2011.

As a result, however, gold looks “inexpensive”. This may prove a good time to top up your holdings in this out-of-favour asset class. Investors should hold 5%-10% of their portfolio in gold.

Hedge against higher prices

For one thing, inflation is beginning to pick up around the world. The yellow metal has served as hedge against inflation eroding the value of stocks and bonds. “Gold was $20.67 an ounce 100 years ago and that bought a good men’s suit,” as Bary points out. “At $1,200 an ounce, the same is true today.”

It has also done well in times of crisis – used as a safe haven for centuries, it’s an asset that tends to thrive on bad news. Gold rallied by 17% in the six months after Lehman Brothers collapsed – a time period when the S&P 500 fell by more than 40%.

Gold is rare – all the gold mined in the world would fit into two Olympic-sized swimming pools – and that makes it valuable. Annual new mined supply adds less than 2% to the global total, so it’s not easy to boost supplies of gold quickly. With paper money, on the other hand,...

ALROSA, the world leader in the diamond mining industry, has successfully completed its own specialized "True Colours" auction with a total sale of $9 million worth of coloured diamonds.

210 unique diamonds were sold in the first round. The bidding was very active, and most of the lots were sold for well above their starting price. The "hero stones" – stars of the collection with a particularly rare combination of qualities, generated enormous interest from bidders. One such "star", which attracted a lot of attention from buyers around the world, was an oval cut Fancy Vivid Orangy Yellow diamond weighing 15.11 carats.During the course of the bidding the diamond doubled in price.

"The collection of large coloured stones – all cut by our company – which we brought to Hong Kong was the biggest in ALROSA's history. We sold the lots for well above their starting prices and consider the auction results to be very positive," said Pavel Vinikhin, Director of the DIAMONDS ALROSA cutting division.

Chinese companies were particularly active in the bidding. 9 of them bought 20 large stones between them. Chinese buyers showed special interest in coloured diamonds of one carat and under. These stones were sold in groups, intended for use by jewellery manufacturers.

During the auction, more than 100 participants from around the world were active on ALROSA's own electronic trading platform.

It is noteworthy that Typhoon Manghout, which swept through the city during the Hong Kong Gem & Jewelry Fair had affected the auction results: many clients were unable to get to Hong Kong and view the lots at the Fair or in the company's office. ALROSA therefore plans to hold an additional auction in the near future.

"We also plan to hold the "True Colours"...