New orders for U.S.-made capital goods increased more than expected in May, but rising interest rates and tighter financial conditions could curb further gains.

Orders for non-defense capital goods excluding aircraft, a closely watched proxy for business spending plans, rose 0.5% last month, the Commerce Department said on Monday. These so-called core capital goods orders gained 0.3% in April.

Economists polled by Reuters had forecast core capital goods orders rising 0.3%.