Investors were also awaiting European Central Bank President Mario Draghi later in the day, in case he provides any new advice on monetary policy.
Most central bank watchers were keen to hear Yellen's views on the likely path of interest rates, but there was no mention of when the next increase may be or the debate raging inside the Fed over the path of rates in the next few years. "They just can't get any money because the banks just won't let them borrow it, because of the rules and regulations in Dodd-Frank".
NEW YORK, Aug 25 (Reuters) - World stock markets advanced while the USA dollar weakened on Friday after Federal Reserve Chair Janet Yellen omitted monetary policy in a much-anticipated speech that left the possibility of a interest rate hike in December open to interpretation.
Yellen's remarks appear to be at odds with statements made by President Trump, who often has claimed that excessive regulation of the financial system has hurt economic growth. The quality of assets held by banks had risen, while dependence on short-term wholesale funding was down by half, she added.
"The balance of research suggests that the core reforms we have put in place have substantially boosted resilience without unduly limiting credit availability or economic growth", she said.
President Donald Trump has denounced the so-called the Dodd-Frank financial reforms - named after the two senators who originally sponsored the legislation - saying they hinder lending.
Aulas évoque la fin du mercato — Lyon
Et surtout pas Jean-Michel Aulas qui cherche à le faire revenir pour lui confier le poste de directeur sportif. "On avance. Je pense qu'on est sur le point d'aboutir dans cette voie-là".
Bank profits have been robust, however, and no substantive policy proposals have yet come forward. The US Treasury in June put out a 147-page report that recommended, among other things, changing the frequency and the severity of the Fed's process of stress-testing the strength of the big banks, scrapping the "gold-plating" of global capital and liquidity standards for the largest US lenders, and implementing a looser interpretation of the Volcker ban on banks making speculative bets with their own capital.
"We re-learned this lesson through the pain inflicted by the crisis", Yellen said.
The euro pushed sharply higher after Yellen's speech was released, gaining 0.6 percent against the U.S. currency at $1.1872 near 1450 GMT.
Yellen's term as Fed chair expires in February, and Trump has given mixed signals about whether he will re-appoint her.
"If anything, both with Draghi and Yellen, the big fear from investors was a more hawkish stance on monetary policy", said Jeffrey Cleveland, chief economist at Payden & Rygel in Los Angeles.
"The Federal Reserve is committed to evaluating where reforms are working and where improvements are needed to most efficiently maintain a resilient financial system", she said.
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