Most Federal Reserve officials prefer to raise benchmark interest rates before selling assets when the time comes to tighten policy, minutes of their April meeting showed on Wednesday.

During an extensive discussion of how the central bank might pull back its massive support for the world's largest economy, officials agreed they would eventually shrink the Fed's much expanded portfolio over the medium term, and getting rid of mortgage-related debt would be a priority.

A majority of participants preferred that sales of agency securities come after the first increase in the (Fed's) target for short-term interest rates, the Fed said.

And many of those participants also expressed a preference that the sales proceed relatively gradually, returning (Fed holdings) to all Treasury securities over perhaps five years, the minutes said.

Policymakers felt that holding off on asset sales would allow them to get their target for overnight rates up from its current level near zero sooner than otherwise, the minutes showed. Feds official have long felt discomfort that their main policy tool was essentially exhausted.

The Fed stressed the discussion of the removal of monetary stimulus should not be seen as an indication the Fed is ready to start down that road any time soon.

The minutes showed worries about inflation rising among some Fed officials. While policy-makers generally believed a higher level of inflation would be transitory, many had become more concerned about upside price risks.

Policymakers worried that if oil prices continued to rise, there might be more pass-through of higher commodity costs into broader measures of prices. They were concerned that inflation, pushed up by higher energy and commodity prices, could set off a self-fulfilling inflationary mind-set.

A few participants in the meeting said the increase in inflation risks meant the Fed should stand ready to tighten financial conditions sooner than had been expected.

Oil prices, however, have dropped sharply since the meeting.

(Reporting by Mark Felsenthal; Editing by Neil Stempleman)