Bad economic news from China and Europe may be good news for U.S. companies and shoppers.
Fresh data from the world's second and third largest economies this week showed they continue to face big headwinds, raising fears that the U.S. may be headed for another "spring slump."
But with global demand weakening for raw materials and other commodities, prices are falling. That discount amounts to billions of dollars in savings for American companies and households.
On Thursday, the Spanish government reported that more than six million Spaniards were out of work in the first quarter of this year, raising the jobless rate in the euro zone's fourth biggest economy to 27.2 percent, the highest since records began in the 1970s.
"These figures are worse than expected," said Citibank strategist Jose Luis Martinez in Madrid.
Spain's shaky banking system has been shored up by a massive financial backstop provided by Europe's central bank. In return, the government in Madrid has made deep cuts in in spending to regain investors' confidence.
Read More at NBCNews:
Just outside the euro zone, meanwhile, the British government released data showed the U.K. economy grew by more than expected in the first quarter, comfortably avoiding recession. The better-than-expected numbers will make it less likely that the Bank of England will extend its recent easy-money policy of pumping fresh cash into the economy.
The euro zone's slowdown is likely to continue as governments, businesses, and consumers tighten their belts under an ongoing "austerity" policy aimed at reducing large piles of government and consumer debt.
Earlier this week, economic data from Beijing showed that China's once red-hot economy is cooling off and is also expected to continue slowing this year. The latest data Tuesday showed yet another monthly drop in new orders to Chinese factories, which economists say is a signal of future weakness in commodity prices.
"One can reasonably expect the cooling-off in growth to persist in the world's most important source of demand for raw materials" said David Rosenberg, chief economist at Gluskin Sheff.
The commodity price drop is sweeping across a broad range of goods—from paper to jet fuel to sugar. Copper prices fell to an 18-month low Tuesday on news of lower factory output in China and Europe.
Iron and steel prices have fallen by 13 percent in the year ended in February, according to the Bureau of Labor Statistics. That lowers the cost of everything from I-beams for new office buildings to the fender panels on a new Chevy Tahoe.
Food manufacturers are benefiting from a 19 percent drop in cane sugar prices in the past year. Apparel makers are paying 17 percent less for a bale of cotton.
Just as consumers are getting a break at the gas pump, airlines are getting a break on their fuel bills as a slowdown in global travel has cut demand for jet fuel. US Airways and Delta Air Lines reported that the tailwind of lower fuel costs helped boost profits in the latest quarter. Delta said it had its best first quarter in more than 10 years.
Economists said the slowdown in Europe and China shouldn't directly affect the U.S. economy.
Despite large investment flows across the Atlantic Ocean, U.S. trade with Europe amounted to $265 billion last year—or about 2 percent of U.S. gross domestic product. China's slowdown will have even less direct impact: U.S. exporters sold just $110 billion worth of goods and services in China last year.
Meanwhile, demand for U.S. products remains strong throughout the rest of Asia, where the U.S. now exports more than twice as much as it does to China. The U.S. auto industry, for example, has seen a surge in exports to Japan, Hong Kong, South Korea, and Taiwain.
"The U.S. has outperformed most other advanced nations partly due to its greater exposure to the faster growing Asian nations and partly due to the willingness of U.S. households to reduce their savings rate more significantly," said Paul Dales, senior U.S. economist at Capital Economics.
Growth in Europe and China is slowing for very different reasons.
In China, a massive government spending boom left the developing country with excess capacity—including billions of dollars worth of brand-new, but near-empty, roads, airports, railways, and housing.
Still, China's 7.7 percent growth in the first quarter remains strong compared to the world's developed economies.
"(That's) not the 10 percent growth rate this economy has demonstrated as its potential—and sustainable—average over the last 30 years, but it is not too shabby," said Carl Weinberg, chief economist at High Frequency Economics.
Wide swaths of Europe's economy, meanwhile, continue to contract under the weight of heavy government spending cuts imposed on weaker peripheral countries.