Fears of a full-blown recession and a weak job market have pushed domestic consumer confidence in the U.S. way down.

The latest RBC cash index, which measures consumer sentiment, dropped to 48.5 for February 2008, almost eight points below January’s 56.3 level.

According to RBC, this is the lowest level since the index was created six years ago.

Consumer sentiment fell across the board, driven especially by declining confidence in current conditions and growing worries about job security and investing, according to the index.

“This month’s reading indicates a very poor mood among consumers who are confronted with news about a housing recession, falling stock prices, problems in the banking system and a deteriorating overall economic environment,” said T. J. Marta, economic and fixed income strategist for RBC Capital Markets, in a release. “With consumer spending driving 70 per cent of the U.S. economy, a pullback in spending increases the risk that the country could tip into recession.”

On Thursday, U.S. retailers posted weak January sales. Major chains such as Wal-Mart and Nordstrom’s were among the those that posted grim results. According to the UBS-International Council of Shopping Centers, retail sales in the U.S. rose a weak 0.5% in January, below the 1.5% forecast. It was the weakest January increase counted in four decades. December’s miserable holiday season growth rate was 0.7%.

These paltry retail sales figures, combined with today’s RBC cash index are further evidence that consumer demand in the U.S. is decreasing in the face of struggling housing market, a weakening job situation and the continuing credit crisis.

The index is a monthly survey national survey of consumer attitudes on the current economic situation. Earlier this week, 1,006 Americans were questioned.