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Confidence among U.S. consumers probably fell in July for the first time in five months as mounting unemployment and depressed wages shook households, analysts said before a private report today.

The Reuters/University of Michigan final index of consumer sentiment dropped to 65, the lowest level since March, from 70.8 in June, according to the median estimate of 57 economists surveyed by Bloomberg News. A preliminary report this month showed a reading of 64.6.

The biggest employment slump of any recession in the last eight decades may be making more Americans feel their jobs are in jeopardy. The growing insecurity, together with falling home values, is prompting households to limit spending and save more, meaning an economic recovery will take time to gain speed.

“Job losses are a major factor weighing on consumers,” said Sal Guatieri, a senior economist at BMO Capital Markets in Toronto. “We’ll see modest consumer spending for a while.”

The report is due at 10 a.m. Washington time. Economists’ forecasts ranged from 62.5 to 68. During the expansion that began in late 2001 and ended in December 2007, the index averaged 89.2.

The economy has lost 6.5 million jobs since the recession began in December 2007. Economists surveyed by Bloomberg predict the unemployment rate may reach 10 percent by year-end from 9.5 percent in June, the highest level since 1983.

Wage Gains

Growing joblessness is putting a strain a wages. Earnings per hour climbed at a 0.7 percent annual pace on average over the last three months, the smallest gain since records began in 1964, according to figures from the Labor Department. A report from the Commerce Department showed the savings rate in May jumped to a 15-year high affordable life insurance.

“Job insecurity, together with declines in home values and tight credit, is likely to limit gains in consumer spending,” Federal Reserve Chairman Ben S. Bernanke said this week in testimony to lawmakers. At the same time, the economy is showing “tentative signs of stabilization,” he said.

One such sign is that the four-year housing slump, which precipitated the financial crisis, is stabilizing. Existing-home sales rose in June for a third straight month, reaching the highest level since October, the National Association of Realtors reported yesterday. The median price fell 15 percent from June 2008.

Better-than-estimated corporate earnings and the jump in home resales boosted stock prices yesterday. The Dow Jones Industrial Average crossed 9,000 for the first time since January, closing up 2.1 percent at 9,069.29 in New York.

Cheaper Gasoline

A decline in fuel prices may provide some relief. A gallon of regular unleaded gasoline at the pump cost $2.46 this week, down from an average $2.64 in June, according to AAA.

Retailers’ results in June showed Americans were shopping more at discounters. Framingham, Massachusetts-based TJX Cos., owner of T.J. Maxx and Marshalls stores, and City of Commerce, California-based 99 Cents Only Stores reported sales gains.

Yum! Brands Inc., the owner of the Pizza Hut and Taco Bell restaurant chains, cut its outlook for same-store sales growth this year, indicating consumers may be reluctant to spend on meals outside the home.

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