Japan edged past China as the largest holder of US debt in February, according to official data.

Data from the US Treasury Department showed that Japan had $1.224tn (£832bn, €1.155tn) of US debt at the end of February, while China's debt holding was $1.223tn. It is for the first time since August 2008, that Japan has become the top holder of US debt.

Both China and Japan reduced their US debt holdings from the previous month by $15.4bn and $14.2bn, respectively. In 2014, Japan increased its debt holdings by $13.6bn, while China decreased it to the tune of $49.2bn.

The third on the list is Caribbean Banking Centres with $350.6bn of US debt, followed by Belgium at $345bn and a group of oil exporting countries at $296.8bn. The UK ranks eighth on the list with $192.3bn of US debt holdings.

Investors consider US debt as a safe investment, and it is rated highly by credit rating agencies.

Total foreign holdings of US debt slipped 0.9% in February to $6.16tn, down from a record of $6.22tn in January, according to the Treasury Department.

The US government has reduced its borrowings in line with its shrinking budget deficit over the past three years. During the 2008 economic crisis, the government largely depended on debt to support the economy.

In 2014, the country's federal deficit declined to $483bn – the lowest level in six years and below 3% of gross domestic product for the first time since 2007.