Foreign holdings of U.S. Treasury securitiess fell in July for the first time in a year as yields on benchmark 10-year notes rose for a second month.

Holdings fell by $16 billion, or 0.3 percent, to $6 trillion, U.S. government data released Tuesday showed, as the Federal Reserve reduced monthly bond-buying amid gains in employment and accelerating economic growth

Overseas investors had increased their stake in U.S. government debt by $420.4 billion, or 7.5 percent, since the last decline in July 2013. That reduction occurred as speculation mounted that the Fed officials would soon begin to taper $45 billion a month of Treasurys purchases and $40 billion a month of mortgages.

China, the largest foreign lender to the U.S., reduced its holdings $3.5 billion, or 0.3 percent, to $1.26 trillion in July. Japan, the second biggest holder of Treasurys, pared its position by $500 million, or less than 0.1 percent, to $1.22 trillion.

Policy makers in December announced they would cut purchases to a total $75 billion a month effective January, and have reduced buy by $10 billion at each meeting since. The central bank is forecast to end its bond purchases by October.