"Patience means the Fed can take its time," said Mary Ann Hurley, vice president of fixed income at D.A. Davidson in Seattle. "I think the Fed is on hold for the rest of the year."
Powell said before the Senate Banking Committee that "crosscurrents and conflicting signals" weakened the case for further rate increases and complicated an otherwise upbeat US economic outlook.
The Fed chairman will also appear before the House Financial Services Committee on Wednesday to wrap up his semi-annual testimony before Congress.
Before Powell's Senate testimony, Treasury yields were lower on data that showed US domestic housing starts dropped 11.2 percent in December to a seasonally adjusted annual rate of 1.078 million units, their weakest pace since September 2016.
The housing sector showed further weakness at the end of 2018. US home prices across 20 cities appreciated at a 4.2 percent annual pace in December, the slowest since November 2014, according to Case-Shiller.
The yield on US benchmark 10-year Treasury notes was down 3 basis points at 2.643 percent, which was at the lower end of its trading range in February.
Two-year Treasury notes were 2.1 basis points lower at 2.486 percent.
On the supply front, the US Treasury Department's sale of $32 billion in a seven-year auction fetched a yield of 2.538 percent, which was the lowest yield at a seven-year auction since December 2007. Its bid-to-cover ratio was the strongest since last August. Investors this week are the most upbeat on owning longer-dated Treasuries in about 2-1/2 years, according to a survey released by J.P. Morgan.