11-day winning streak of the USD comes to an end.

The dollar dropped against a basket of major currencies on Thursday, retreating further from a one-month high, amid lower U.S. bond yields and uncertainty over the timing of the Federal Reserve's next interest rate increase.

The greenback was on track for a second day of losses following a winning streak where it touched a 5-week peak versus the EURO and a 2 week highs against the JPY.

Traders have scaled back bets on a looming U.S. rate hike as they concluded Fed Chair Janet Yellen didn't deliver enough conviction, at her economic testimony before Congress on Wednesday, on whether the Fed's next rate increase will come at its March 14-15 meeting.

However, she signaled more than two rate increases may be possible this year as the economy approaches full employment and inflation closes in on the Fed's 2 percent goal.

The euro gained 0.7% at $1.0672, recovering from a 5-week lows of $1.052 set on Wednesday.

Earlier Thursday, the greenback briefly pared its losses against the euro and yen following encouraging data led by a Philadelphia Fed measure on U.S. Mid-Atlantic business activity which hit a 33-year high in February.

Reduced expectations about a rate increase in March, together with declines on U.S. equity indexes, helped revive investors' appetite for U.S. Treasuries, pushing benchmark yields below 2.50%.

After Yellen raised the possibility of more than two rate increases, other Fed officials, including Fed Vice Chair Stanley Fischer and New York Fed President William Dudley, emphasized the overall path of further rate rises would be a gradual one.

Interest rates futures implied traders saw a 22 percent chance of a rate increase in March, down from 31% on Wednesday.