The Composite Business Outlook Index was 65 in March, down from 66 in December 2011. Although the index fell, most of the current business condition indexes that are based on year-over-year comparisons increased in March. Further, all of the current business condition indexes (with the exception of the Inventory and Capacity Utilization Indexes) remain well above 50 percent, the dividing line between expansion and contraction. The Capacity Utilization Index increased from 38.1 percent to 40 percent and remains above its long-term average of 32 percent. The Inventory Index has fallen steadily since June 2011 when it reached a record high of 82 percent. The fall should be interpreted as a positive sign in that inventories were likely above their desired level because of a slowdown in the growth in sales. Most respondents expect earnings in 2012 will increase over their 2011 levels, though the earnings outlook for the Eurozone was the weakest.