(Bloomberg) -- The dollar fell for a second day against most major peers as Federal Reserve Chair Janet Yellen reiterated that the central bank’s timetable for raising interest rates is flexible.

The U.S. currency remained lower as Yellen testified Wednesday to a House committee. She told a Senate panel Tuesday that the labor market was improving even as inflation and wage growth remain too low. Volatility in the $5.3 trillion-a-day currencies market has plunged this week.
The prospect of a “June rate hike is pushed back, it’s even less likely now,” said Robert Lynch, a currency strategist at HSBC Holdings Plc in New York. “The dollar has come off a little bit.”
The Bloomberg Dollar Spot Index, a gauge of the U.S. currency versus its 10 major peers, retreated 0.2 percent to 1,163.13 as of 5 p.m. in New York, extending a decline on Tuesday. Before Yellen spoke Tuesday, the measure had climbed to almost the Feb. 11 peak, which was its highest in data going back to 2004.
The dollar slipped 0.1 percent to 118.86 yen and fell 0.2 percent to $1.1361 per euro. Euro-region finance ministers agreed to a package of economic measures for Greece on Tuesday, paving the way for loans to continue flowing to the country.

Volatility Plunge

JPMorgan Chase & Co.’s Global FX Volatility Index, a measure of anticipated price swings, fell to 8.93 percent, the lowest since Dec. 2 and down from 11.68 percent last month.
“More notable than spot moves is the collapse in foreign exchange volatility that is under way, with Yellen and Greece behind us,” Adam Cole, head of global currency strategy at Royal Bank of Canada’s RBC Capital Markets unit , wrote in an e-mail note.
Yellen repeated that the Fed’s pledge to be “patient” on starting to raise borrowing costs means an increase is unlikely for “at least the next couple” of meetings. The central bank adopted the guidance in December and repeated it in January.
She added that a rate increase “could be warranted at any meeting.” The Fed has held its target for the federal funds rate at virtually zero since December 2008 to bolster economic growth.

Yellen View

“The market reads her testimony as slightly dovish,” Douglas Borthwick, the head of foreign exchange at New York brokerage Chapdelaine & Co., said by phone. “She has to walk a fine line. She wants the market to think they can raise in June, but at the same time it’s really dependent on data and how they’re coming out.”
Traders see a 55 percent chance the Fed will raise the benchmark by its October meeting, according to futures data compiled by Bloomberg. That’s up from 53 percent on Jan. 26.
The dollar has been supported in 2015 by an improving economy. Gross domestic product will expand 3.1 percent this year, compared with 2.14 percent across the Group of 10, according to economists surveyed by Bloomberg.
The Fed’s path to higher interest rates contrasts with its counterparts in the euro area, Japan and China, which have resorted to looser monetary policies to boost economic growth and inflation.
The dollar is the best performer in a basket of 10 developed-nation peers during the past year, gaining 15.1 percent, according to Bloomberg Correlation-Weighted Indexes. The euro dropped 6.4 percent and the yen declined 2.5 percent.
To contact the reporter on this story: Andrea Wong in New York at awong268@bloomberg.net
To contact the editors responsible for this story: Dave Liedtka at dliedtka@bloomberg.net Paul Cox, Kenneth Pringle