LONDON – In the diamond industry, the only place that really matters is the US, and the market is starting to look a little shaky.

In a country where consumers buy almost half the world’s gems, Tiffany & Co. and Signet Jewelers this week reported disappointing sales. That’s a blow to expectations that President Donald Trump’s pro-business policies would give consumers more money to spend on luxury items such as diamonds.

“There’s been a deterioration of sentiment around the US,” said Anish Aggarwal, a partner at consultant Gemdax in Antwerp. “The projected demand bounce expected from Trump’s election hasn’t materialised.”

The US has been a bright spot in the diamond industry, expanding its market share in the past five years. American demand rose 5% to a record $39 billion in 2015, offsetting much of a contraction in the rest of the world. De Beers Chief Executive Officer Bruce Cleaver had expected that to continue, saying in December that Trump’s policies should offer at least a short-term boost for the retail market, a view echoed by Petra Diamonds' CEO.

Those hopes took a knock Wednesday when New York-based Tiffany reported an unexpected first-quarter sales decline, citing sluggish demand in the Americas because of reduced spending by locals and tourists. The next day, Signet said first-quarter sales slumped 12% amid the slowdown in jewelry spending.

The disheartening retail results come as the largest diamond firms have been increasing supply in the market by drawing down stockpiles. Top producer De Beers sold $1.86-billion in its first three sales of 2017, including a $720-million offering in January, its biggest in at least a year. Alrosa PJSC, the second-biggest miner, increased first-quarter sales by 17% to 12.1-million carats.

High sales of rough diamonds in the first quarter means the polished gems are now reaching the market, according to Gemdax’s Aggarwal. Growth in supply will probably outstrip demand in 2017, so the top producers could start to limit output toward year-end to better match consumption, he said.