Prospects of deeper problems in the US jewellery market and fears of a wider recession dominated sentiment in the diamond market. There was speculation of a possible bankruptcy filing by a major US retailer. Smaller bankruptcies were reported in the US wholesale trade. A sizable bank financing the trade signalled caution in its lending policy. “We are more careful and have become less flexible with our existing requirements,” the bank said, speaking on the basis of anonymity. With prices in high-end diamonds spinning higher, the trade is becoming fearful of speculation that could lead to a sharp reversal. Evidence is growing that consumers curbed spending during the all important US holiday season and there are deeper problems reported in the US jewellery retail market. In the Far East, traders at the first Jewellery & Watch fair in Macau this week reported active buying between foreign wholesalers participating in the Show. Chinese retailers and players from the region as a whole attended in lesser numbers, as this is traditionally a slow buying season. Also it is the Macau Fair’s first year. Clear evidence that China is emerging as a major market, Antwerp World Diamond Centre (AWDC) said, are figures showing that over the first 11 months of 2007, exports of polished diamonds from Belgium to mainland China rose 67.5% compared to the corresponding period a year earlier. This makes the entire Chinese region Antwerp’s second largest polished diamond export market after the US. However, this growth is also driven by the jewellery manufacturing industry for re-export and therefore may not represent actual local consumer growth in demand.

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