The overall PolishedPrices index rose by 3.0% during the month with the average for December 1.2% above the average for November and 13.8% above the average for December 2009.



The final surge in polished diamond prices during December left the level of the index well above our forecast made at the start of the year.

Firstly, we had underestimated the rate of price growth during the first half of the year. In our forecast we had prices in the diamond trade increasing by 3% up until the end of May. This rate turned out to be just over 6%, leaving our forecast hovering around the upper confidence limit we had given in January.

The second divergence came towards the end of the year, when the seasonal slowdown in diamond prices failed to materialise. For seven of the nine years that PolishedPrices has been collecting actual trading data, there has been a decrease in prices towards the end of the year, the other exception coming in 2007.

This year prices continued strong growth and it is a matter of debate as to whether this signifies a genuine shift in seasonality caused by the increasing importance of Asia to the diamond market.