The average price of diamonds is slowly settling down after peaking in late July. The soft decline comes after a wild up hill race and while traders feel unsure about the upcoming Hong Kong trade fair.

The IDEX Online Diamond Index on Tuesday closed at 144.6, down 2.4 percent from the 148.0 peak of July 29.

The price of gold also softened this week, closing at $1,820 per ounce in London, after reaching a record $1,895 on September 6.

The jewelry industry is focusing on the important September Hong Kong Jewellery & Gem Fair opening on the 19th. The less than enthusiastic mood in the global diamond centers is translating to mixed expectations from the show.

Diamond traders are concerned both about the price of polished diamonds they will achieve at the show as well as the volume of orders.

The softening in polished diamond prices, an unusual occurrence a week before a major trade show, is placing a cap on rough diamond prices, playing a contributing role in depressing rough prices in recent weeks.

In Antwerp, traders are already contemplating how low they are willing to go in selling the goods they will purchase at the next DTC Sight that starts September 26, a day after the Hong Kong show ends.

The Hong Kong show is therefore an important indicator for demand – and prices – as the all important holiday season approaches.