WASHINGTON • New orders for U.s.-manufactured goods rebounded in December, but higher interest rates are weighing on business spending on equipment, which could keep manufacturing under pressure.

The Commerce Department said Thursday that factory orders increased 1.8% after dropping 1.9% in November.

Orders increased 11.8% on a year-on-year basis in December.

The Federal Reserve’s fastest cycle of interest rate hikes since the 1980s, aimed at fighting inflation, is undercutting demand for goods, which are mostly bought on credit.

The dollar’s past appreciation against the currencies of the United States’ main trade partners and a softening in global demand are also hurting manufacturing. Spending is shifting back to services. The Institute for Supply Management said Wednesday its manufacturing PMI contracted for a third straight month in January. —