It's a fairly typical question to which the answer is rather nuanced, as is so often the case.

That's because even diamonds of the same carat weight and shape can vary substantially in terms of their overall grade quality (the other two of "the four C's"), as well as other less talked about determinants, such as proportions and visual characteristics.

These in aggregate can dictate material price differences.

So let us narrow down these variables and consider the pricing of a one carat, round brilliant cut natural diamond.

And let's choose a stone with colour grade F and clarity VS1 (very slightly included),"triple ex" (excellent cut, polish and symmetry), independently graded by the GIA.

This will be, in simple terms, a very decent diamond ring and round cuts remain, albeit by a slim margin, the favourite shape for engagment proposals.

But let's first briefly take a look at the latest diamond-industry pricing trends.
The percentage movements in prices shown in the graph refer to round cuts, including different carat weights.

As we concluded in our previous post on this subject five months ago, the decline in natural diamond values, originating in 2019, has indeed extended further, with all carat weights above fifty "points" (half a carat) feeling the pressure.

And we remain of the view that, while other economic and geopolitical factors may have played their part in this repricing process, it is the emergence and popularity of lab grown diamonds which has been the key driver in deflating values.

In any case, the uncomfortable truth is that jewellery grade diamonds in general have lost approximately 40% of their value over the past five years.

Conversely, the appreciation in the gold price has been noteworthy - and relevant of course in the pricing of a diamond ring as a whole.

The price of an 18k gold and diamond engagement ring, if set with a very small stone, is relatively sensitive in percentage terms to fluctuations in the gold price, as the ring shank itself represents may be half the total cost.

But in the case of pricing the one carat ring we are using in this example, the increased value of gold is a country mile away from offseting the depreciation in diamond values seen over the most recent five years.

Other rising costs incurred by practically all industries have not spared the diamond and jewellery trade however.

 
The impact of these upon retail jeweller's pricing is more complicated to accurately quantify, but the takeaway is that while diamond values have fallen, operating, marketing and financing costs have spiked.

The good news is that you should still expect to pay less today for that dream one carat diamond ring, compared to two or even three years ago.

In some cases, depending on carat weight and grade, this could be as much as 25% less.

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