The central bank now has assets - such as USA government bonds and mortgage securities bought when it was seeking to boost the economy after the financial crisis - valued at $4.5 trillion on its balance sheet.
The Fed, chaired by Janet Yellen, bought Treasury and mortgage-backed bonds on a hitherto unprecedented scale in the wake of the financial crisis to help to keep interest rates low and to encourage job creation and economic growth.
The minutes said that Fed officials agreed that if the economy continued to perform as expected that "a change in the committee's reinvestment policy would likely be appropriate later this year".
"The December FOMC meeting is probably the most likely date to introduce this change", said Paul Ashworth, chief USA economist at Capital Economics in Toronto, following the publication of the minutes.
With improving economic conditions, the Fed increased interest rates by 25 basis points on March 15.
US sanctions North Koreans linked to weapons of mass destruction
Trump said while he believes in alliances and partnerships, they "have not always worked out very well" for the U.S. The North also denounced ongoing military drills involving American hardware and troops in South Korea.
Minutes of the Fed's March policy meeting, released Wednesday, contained details of the central bank's first intensive discussion of how to unwind its massive balance sheet.
What they all agreed on was that shrinking the balance sheet should be gradual and predictable and almost all said that any altering of the policy "should be communicated.well in advance of an actual change". That would allow the Fed's balance sheet to gradually run down in a process that is likely to take years. One meeting participant, the minutes noted, called for a "rapid" drawdown in the size of the Fed's assets, starting with mortgage-backed securities-the once fatefully-overpriced, complex assets whose values dropped precipitously during the 2007 housing market crash. But financial markets have been closely watching for any Fed signal on the timing of when the Fed would begin reducing the level of its bond holdings by halting its current practice of replacing any maturing bonds.
"Several participants now anticipated that meaningful fiscal stimulus would likely not begin until 2018, " the minutes read.
The minutes from the Fed's March meeting showed continued uncertainty about how the White House's policies would affect the economy, with only about half of the Fed's voting members incorporating assumptions about fiscal policy into their economic projections. But there was less agreement over the issues of inflation and Trump's economic plans. The Fed's two goals are to achieve maximum employment and moderate inflation.
The Fed's preferred inflation measure, the Personal Consumption Expenditures price index, has moved steadily towards the Fed's two percent target, adding to pressure on the central bank to raise rates. Unemployment is now below the Fed's 4.8 percent goal, while inflation has remained below the Fed's 2 percent inflation goal for several years.