Global polished diamond prices rebounded to their highest level in 18 months during May. The IDEX Online Polished Diamond Price Index rose to 116.5 for May; it last stood at this level in December 2008.

May’s IDEX Online Index indicates that diamond prices have recovered nearly half of their precipitous decline that occurred in 2009. Global polished diamond prices bottomed at 108 during the summer and early fall of 2009, just over 7 percent below their current level. At its height, the IDEX Online Polished Diamond Price Index stood at just above 128 in August 2008, almost 11 percent higher than today’s average prices.

Over the past year, the IDEX Online Polished Price Index has risen by 7.1 percent; based on average prices during April and May 2010, it has risen by 1.6 percent on a month-to-month basis.

On a day-to-day basis in May, the IDEX Polished Diamond Price Index rose sharply at the beginning of the second week, and held steady at this higher level for the remainder of the month as it built a firm base which we believe will provide a springboard for higher prices later this year.

First quarter sales trends from U.S. retailers and specialty jewelers indicate that people have resumed buying jewelry at a pace nearly equal to the robust days of two years ago. We believe that diamond demand will continue to grow, resulting in a November-December holiday selling season this year that could see jewelry sales rise by a mid-to-high single digit level.

The graph below summarizes the IDEX Online Polished Price Index performance over the past two years

[caption id="attachment_862" align="aligncenter" width="541" caption="Online polished diamond price index"]<a href="http://blog.biggstock.com/wp-content/uploads/2010/06/Online-polished-diamond-price-indes_biggstock.gif"><img class="size-full wp-image-862" title="Online-polished-diamond-price-indes_biggstock" src="http://blog.biggstock.com/wp-content/uploads/2010/06/Online-polished-diamond-price-indes_biggstock.gif" alt="" width="541" height="326" /></a>[/caption]

REF:<a href="http://www.idexonline.com/portal_FullNews.asp?SID=&amp;id=34101" target="_blank">Polished Diamond Demand Pushes Prices Higher in May</a>