China pared its holdings of U.S. treasury bonds for a third straight month, a key reason for a drop in foreign demand for U.S. debt.

The U.S. largest creditor cut holdings of by 31.9 billion U.S. dollars, or 2.8 percent to 1.1 trillion U.S. dollars in December, according to Treasury Department data released on Wednesday. Its position in longer-term notes and bonds also fell 32.5 billion U.S. dollars, or 2.8 percent, to 1.1. trillion U.S. dollars, the least since June 2010.

Japan, the second-largest buyer of Treasury debt, increased its holdings by 0.3 percent to 1.04 trillion U.S. dollars.

Britain, the third-largest foreign holder of Treasury debt, cut its holdings 2.6 percent in December to $414.8 billion. A group of 15 oil exporting countries boosted their holdings 0.6 percent to $233.5 billion.

Ending December, foreign creditors hold a total of 4.73 trillion U.S. dollars in U.S. debt, down 0.4 percent from the previous month’s 4.75 trillion.