Gold slid Tuesday, as investors flocked to the dollar after a stronger-than-expected economic report reduced the chances of a near-term interest rate cut by the

Federal Reserve

.

The Census Bureau says U.S. wholesale inventories grew by 1.1% in August, almost double the forecast 0.6% increase and ahead of the previous month's revised figure of 0.9%.

"The data here confirmed the economy is somewhat healthier than previously thought, pushing odds of a Fed rate cut out to May," says Randy Diamond, an analyst at Miller Tabak in New York.

The healthy economic news helped push the dollar up, which was buying 119.66 yen, compared to 119.12 yen Monday. The greenback was also higher against the euro, which was trading at $1.2524 vs. $1.2601 a day earlier. Foreign-exchange investors tend to pick currencies where perceived future returns are greater.

The flight to the dollar helped keep a lid on gold bullion, which tends to move in the opposite direction to changes in the price of the U.S. currency. Contracts for December delivery of bullion were losing $5.90 at $576.90 an ounce on the Comex division of the New York Mercantile Exchange. The bullion exchange-traded funds,

streetTracks Gold Shares

(GLD) - Get Report

and

iShares Comex Gold Trust

(IAU) - Get Report

, were losing in line with the metal, off about 0.5% recently.

It also seems that the yellow metal was taking second place to the U.S. dollar in its role as a safe-haven investment.

"What happened with the North Korea nuclear bomb issue is that everyone is running to the dollar instead of gold," says Carlos Sanchez, an analyst at New York-based specialty consulting firm CPM Group. "Normally people would run to gold, but the dollar is also a secure investment."

Meanwhile, the chart watchers note that a bearish tone is currently gripping the market, and it may take a significant move higher to break the negative sentiment.

"Traders have gone from buying dips to selling rallies," says Peter Grandich, editor of the

Grandich Letter

. "Even if you are a bull like me, you can't disrespect the technical damage that has been done."

Grandich adds that resistance at around $610 an ounce will need to be convincingly pierced before any major bullion rally can resume.

Reaction among mining investors was, however, mixed, with

Crystallex International

( KRY) dipping slightly, lower by 1%, and

AngloGold Ashanti

(AU) - Get Report

ahead by 1.2%. Shares of the

Market Vectors Gold Miner

(GDX) - Get Report

ETF were gaining, 1.3%.

On the base-metals side, Comex December copper contracts were slipping 2.8 cents at $3.385 a pound.

Fund "selling may continue to make the upside going more difficult, as has been seen over the summer and throughout September," notes William Adams, an analyst at

Basemetals.com

in London.

Investors in U.S. copper miner

Phelps Dodge

( PD) were, however, unfazed and shares were trading up about 1% recently.