The 2-year Treasury yield edged up to near 0.80 percent, while the 10-year yield held higher around 1.83 percent.
The U.S. dollar index held off lows, down about 0.2 percent, with the euro at $1.13 and the yen at 112.57 yen against the greenback. The dollar index is down more than 1 percent for the week so far.
Speaking to the Economic Club of New York on Tuesday, Yellen noted it is appropriate for policymakers to proceed "cautiously."
She also said recent readings on the strength of the U.S. economy since the beginning of the year have been mixed. The S&P 500 and Dow Jones industrial average closed at their highest levels of the year so far on Tuesday and in positive territory for 2016. Both indexes are now within 4 percent of their 52-week intraday highs.
Sentiment remained positive on Wednesday morning with European markets trading higher and most Asian markets advancing overnight.
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In other Fed commentary, Chicago Fed President Charles Evans said on CNBC's "Squawk Box" he would be surprised if conditions were met for rate hike in April. He also said the "hurdle is high" for the threshold for having confidence that inflation will move sustainably towards the Fed's 2 percent target.
Evans is also scheduled to speak at 1 p.m. at the Forecasters Club of New York. He is viewed as one of the more dovish members of the central bank.
—CNBC's Patti Domm and Evelyn Cheng contributed to this article.