The US Federal Reserve may not go back on the plans to raise interest rates further this year, Fed chief Janet Yellen has told US lawmakers.

However, Yellen admitted tighter credit markets, volatile financial markets, and uncertainty over Chinese economic growth posed greater risk to the US economy, Reuters reported.

"I don't expect the (Federal Open Market Committee) is going to be soon in the situation where it is necessary to cut rates ... There is always a risk of a recession...and global financial developments could produce a slowing in the economy," Yellen said.

Yellen expressed hope that gradual rate hikes will be rolled out in tandem with the growth the of the US economy.

"I think we want to be careful not to jump to a premature conclusion about what is in store for the U.S. economy. I don't think it is going to be necessary to cut rates."

The upbeat stance of Yellen helped markets recover ground on Wednesday after concerns over slow US fourth quarter earnings, low oil prices and a slowdown in China roiled the markets for most art of the new year.-