The Federal Reserve will rely primarily on letting bond holdings run off the balance sheet as they mature, rather than selling bonds outright, as it seeks to trim its massive portfolio, the central bank said on Wednesday.

"The Committee intends to reduce the Federal Reserve’s securities holdings over time in a predictable manner primarily by adjusting the amounts reinvested of principal payments received from securities held in the System Open Market Account (SOMA)," the Fed said in principles released at the end of the central bank's two-day policy-setting meeting.

Fed officials also said they expect they will begin reducing the central bank's balance sheet after they start raising interest rates.

And the Fed said it intends to hold mainly Treasury securities in the longer run, reducing its footprint on other types of credit.

The Fed's nearly $9 trillion portfolio had doubled in size during the pandemic as the central bank snapped up Treasury bonds and mortgage-backed securities to support markets and the economy. Policymakers are now crafting a plan for reducing those holdings, but Fed officials will need to tread carefully as they shrink their holdings.

"The Committee is prepared to adjust any of the details of its approach to reducing the size of the balance sheet in light of economic and financial developments," the Fed said in a statement.