Market moves: Commodities split as gold, silver and diamonds take different paths
According to Commercial Bank of Dubai’s recent market analysis gold and silver diverging as commodities enter a more selective phase, while diamonds continue to show an uneven recovery across segments.
21 May, 2026
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The year’s second quarter has begun by showing that precious commodities are entering a more selective phase after the extreme volatility seen earlier in the year, according to Commercial Bank of Dubai’s (CBD) most recent market analysis.
Gold continues to draw support from geopolitical uncertainty (mainly crude price movements) and reserve diversification, silver is responding to industrial and speculative demand, while diamonds are navigating uneven recovery across inventory and ownership structures.
Gold and silver ratio widens
One of the clearest indicators of changing market conditions remains the gold-silver ratio, which measures how many ounces of silver equal one ounce of gold. Historically, lower ratios have coincided with inflationary booms and commodity rallies, when silver outperformed gold, while higher ratios have appeared during recessions and financial stress, when gold strengthened faster, the CBD analysis showed.
Over the past five decades, the ratio has ranged from nearly 27:1 during the 1979–1980 commodity rally to above 80:1 during recessionary periods such as 1991 and 2019–2020. In 2011, silver’s rally toward $50 per ounce compressed the ratio to roughly 45:1 as gold approached US$1,900 per ounce.
The Covid-19 crisis produced some of the sharpest movements on record. Gold prices rose on safe-haven demand and central-bank buying while silver’s industrial demand weakened significantly. The ratio briefly crossed 120:1 in March 2020 before averaging 86:1 across the year.
However, the recent movements have remained volatile. The ratio widened toward 100:1 in early 2025 as gold climbed above $3,400 per ounce while silver lagged. By late 2025, the ratio eased back into the 70:1–80:1 range as silver partially recovered. Early 2026 saw another sharp adjustment following tariff announcements and simultaneous inflows into both metals. Gold moved above $5,000 per ounce while silver surged beyond $100 per ounce, compressing the ratio into the low 50s before stabilising closer to historical averages.
Over the last 50 years, the ratio has broadly averaged between 50:1 and 70:1. Ratios above 80:1 have often coincided with recessionary conditions and financial stress, while lower ratios have historically appeared during periods of strong commodity momentum and inflation. During the 1980 commodity peak, the ratio briefly approached 17:1. During the 2020 market dislocation, it reached approximately 125:1.
The recent divergence reflects structural differences between the two metals. Gold continues to behave primarily as a monetary asset supported by reserve diversification, central-bank buying and geopolitical uncertainty. With India announcing sharp hike in import duty on Gold, the situation is fast evolving and regional indicators may shift. Meanwhile, Silver has become increasingly tied to industrial production, green-energy applications, electronics demand and tighter mining supply conditions, thereby reflecting commodity characteristics to a monetary metal .
Diamonds on uneven recovery
The diamond market has also shown divergence across pricing and demand segments. Polished diamond prices rose 11.6 per cent year-on-year during the first quarter of 2026, indicating gradual recovery in downstream demand. Rough diamond prices, however, declined 27 per cent due to weaker immediate buying interest and continued caution across manufacturing and trading segments.
Antwerp trading volumes improved during the quarter, supported partly by temporary shifts in business activity from the UAE following the recent Middle East conflict. Rough import volumes increased 35.7 per cent although value growth remained limited to 3.7 per cent, reflecting continued pricing pressure within rough markets. As rough pricing remains linked to polished yield expectations, sustained improvement in polished pricing may eventually provide support for rough markets.
Also interesting is the recent US retail activity ahead of Mother’s Day indicating stable demand for larger round stones and elongated fancy shapes. Larger US wholesalers continued to outperform smaller players due to stronger access to scarce inventory, reinforcing growing bifurcation across the market.
Production cuts have also continued to support pricing for larger and higher-quality diamonds (>2ct), while Indian manufacturing activity entered a seasonal slowdown during May. De Beers reported first-quarter 2026 sales of $648m, up 25 per cent year-on-year following price reductions introduced in January 26. Market attention is now turning toward the JCK Las Vegas show scheduled between May 29 and June 1.
Structures shifting in luxury jewellery
Structural shifts are becoming more visible across the luxury jewellery sector. Kering Jewellery (parent of ‘Gucci’), built through acquisitions including Boucheron, Pomellato, DoDo and Qeelin, has expanded to approximately 150 boutiques globally. Since 2016, the group has focused on directly operated stores and productivity-led expansion, particularly across Japan and Asia-Pacific.
In the first quarter of 2026, Kering Jewellery reported revenues of EUR269m, rising 14 per cent year-on-year, while volumes increased 22 per cent despite softer diamond pricing. The performance contrasted with a broader 6 per cent decline at group level, driven largely by weakness at Gucci and pressures linked to the Middle East environment.
At the same time, Anglo American’s planned divestment of its 85 per cent stake in De Beers remains one of the industry’s most closely watched developments. Three bidding groups have emerged, including a consortium led by former De Beers CEO Gareth Penny, and Pluczenik; Swiss sightholder Diacore led by Nir Livnat; and Burgundy Diamond Mines chairman Michael O’Keeffe, whose group brings upstream mining exposure through Canada’s Ekati mine.
Botswana, which already holds a 15 pr cent stake in De Beers with pre-emptive rights, has continued to push for greater influence within the ownership structure, while Angola has also expressed interest in participation. The process points toward a more state-influenced ownership structure across the diamond industry.
Recent industry initiatives have also focused on strengthening sentiment around natural diamonds. The first World Diamond Day on April 8 reportedly reached approximately 30 million consumers globally and contributed to a sharp increase in online searches linked to natural diamonds.
Separately, Christie’s Geneva is expected to showcase the 5.50-carat Ocean Dream blue-green diamond in May, with estimates reaching up to $12.8m. Only two naturally occurring blue-green diamonds are known to exist globally, including Ocean Paradise, discovered in Brazil in 2012.
Different markets, different pressures
The second quarter of 2026 is suggesting that gold, silver and diamonds are responding to separate drivers rather than moving through a single commodity cycle. Gold is linked to reserve diversification and geopolitical uncertainty, the analysis showed.
Silver continues to balance safe-haven demand with industrial consumption and supply constraints. Diamonds are adjusting to tighter inventories, selective luxury demand and a changing ownership landscape across the global supply chain.
