The Composite Business Outlook Index was 61 in June, down from 65 in March. Although the index remains above 50, the dividing line between expansion and contraction, the pace of expansion is slowing. The index has declined steadily since reaching a record high of 81 in June 2010.

All of the individual indexes (with the exception of the Inventory Index) fell in June, reinforcing the outlook for slower growth. The Inventory Index’s increase, however, is also a sign of slowing in that inventory levels generally increase when manufacturing activity slows. The Non-U.S. Prospective Shipments and Non-U.S. Investment Indexes registered the sharpest declines, which is not surprising given that the Eurozone economies are slipping into recession and growth in China is slowing.