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Future of natural diamonds challenging; holds promise of transformation: BCG report

A new report by the Boston Consulting Group (BCG), commissioned by De Beers Group, unveils the critical factors that will shape the future of the natural diamond market

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A new report by the Boston Consulting Group (BCG), commissioned by De Beers Group, unveils the critical factors that will shape the future of the natural diamond market.In an era marked by rapid changes and emerging challenges, the natural diamond industry stands at a pivotal juncture. A recent report by the Boston Consulting Group (BCG), commissioned by De Beers Group, sheds light on the critical factors shaping the future of the natural diamond sector. With primary diamond supply projected to decline and demand dynamics evolving, the industry is poised for a significant transformation, it notes.

The cornerstone of the natural diamond industry’s future is the anticipated decline in primary supply. The report highlights that the primary production of natural diamonds is expected to decrease by approximately 1% CAGR over the next decade. This decline is driven by the diminishing yields from ageing mines, a scarcity of new discoveries, and constrained exploration budgets over the past ten years. While there is potential for some increase through brownfield expansions, the overall outlook suggests a tightening of supply.

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International News

Gold, Silver Slide as Inflation and Fed Outlook Dominate Geopolitical Risks AUGMONT BULLION REPORT

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  • Safe Heaven Dynamics – Gold and silver remain under pressure, slipping to $4800 and $75 respectively, as stronger US producer inflation and a firm dollar outweigh safe-haven demand from Middle East tensions. Elevated real yields continue to cap upside, keeping sentiment weak despite geopolitical risks.
  • Geopolitical Developments – Escalation intensified after Iran struck a Qatari site hosting the world’s largest LNG facility, following attacks on its South Pars gas field. This marks a significant widening of the conflict, raising energy security concerns and inflation risks, while increasing uncertainty across global markets.
  • Monetary Policy stance – The Federal Reserve held rates steady, highlighting inflation risks from the conflict and signaling a cautious stance. While one rate cut is projected this year, policy easing will depend on clear signs of inflation cooling, keeping metals sensitive to macro data.

Technical Triggers  

  • Gold has reached its $4850 (~ Rs.152,000) support and may consolidate near current levels. 
  • Silver is testing key support at $75 (~ Rs.250,000); a breakdown could extend declines toward $72–70 (~ Rs.235,000–Rs.230,000).).

Support and Resistance

MetalMarketSupport LevelResistance Level
GoldInternational$4800/oz$5250/oz
GoldDomestic₹150,000/10 gm₹165,000/10 gm
SilverInternational$72/oz$85/oz
SilverDomestic₹235,000/kg₹268,000/kg

Source:AUGMONT BULLION REPORT

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