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Consumer confidence in January falls to 14-month low

BY Katherine Boccaccio

New York City –A report released Tuesday by The Conference Board showed that confidence among U.S. consumers fell in January to its lowest point since November 2011.

The Conference Board’s index decreased to 58.6, down from a revised 66.7 in December. The figure was lower than forecast; Bloomberg predicted a median of 64.

The drop in confidence coincides with the 2% payroll tax increase used to fund Social Security.

“The thing that’s particularly troubling is the sizable decline in expectations,” Guy Lebas, chief fixed-income strategist at Janney Montgomery Scott LLC told Bloomberg. “As those expectations deteriorate, it doesn’t bode particularly well for day-to-day consumer spending.”

The 8.1-point slump from December to January is the biggest since August 2011, and parallels other measures of consumer confidence. The Bloomberg Consumer Comfort Index dropped in the week ended Jan. 20 to the lowest level since early October and the Thomson Reuters/University of Michigan preliminary index of consumer sentiment dropped in January to its lowest point since December 2011.

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Report: Supervalu sets rate on $2.4B loan for Cerberus sale

BY Katherine Boccaccio

Eden Prairie, Minn.Bloomberg reported Tuesday that Supervalu Inc. has set the rate it will pay on $2.4 billion of loans to fund the sale of five supermarket chains to a Cerberus Capital Management LP-led investor group.

A six-year, $1.5 billion term will pay interest at 5.75 percentage points more than the London interbank offered rate with a 1.25 percent minimum, reported Bloomberg, citing an unnamed source.

Supervalu may sell the debt at 98.5 cents on the dollar, according to the report, and lenders to the term portion are offered one year of 101 soft-call protection – which means that Supervalu will have to pay one-cent more than face value to reprice the debt in its first year.

The financing also includes a $900 million asset-based revolving line of credit that will begin paying interest at 2 percentage points more than Libor, reported Bloomberg, citing a Monday regulatory filing.

Proceeds from the debt will be used to replace a $1.65 billion asset-backed credit line, an $846 million term portion and to refinance $490 million of 7.5% notes that come due in November 2014.

Supervalu is selling its Albertsons, Acme, Jewel-Osco, Shaw’s and Star Market stores and related pharmacies to AB Acquisition LLC, an affiliate of a Cerberus-led investor group, in a transaction valued at $3.3 billion.

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NRF chief applauds Congress on immigration efforts

BY CSA STAFF

Washington, D.C. — The National Retail Federation president and CEO Matthew Shay has issued the following statement in support of immigration reform:

“Our current immigration system is broken and unworkable, and it is in desperate need of reform. We applaud the President’s commitment and Congress’ resolve to address immigration reform this year.

“NRF has been and continues to be a strong advocate for bipartisan, comprehensive immigration reform.

“In order to compete in the global marketplace, where trade and talent are borderless, the United States needs an immigration and visa system that is both agile and responsive, and addresses employers’ needs and demands and those of today’s more agile and transient workforce.

“NRF will continue to support practical, comprehensive immigration reform that protects employers, retailers and the broader work force.”

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