REUTERS - LONDON. The dollar held near three-week highs on Tuesday as a drop in market volatility ramped up demand for riskier assets.

With 10-year U.S. Treasury yields up by more than 20 basis points over the past four weeks to a one-month high, demand for U.S.-denominated assets has grown.

Broader market moves were quiet as financial markets reopened after the Easter holiday.

The dollar index against a basket of six key rivals rose to 97.39, edging toward the 2019 high of 97.71 struck in early March.

"We are in a very range-bound market with the broader picture being more positive for the dollar relative to the euro after the weak eurozone PMI manufacturing data last week," said Ulrich Leuchtmann, head of FX strategy at Commerzbank.

Data released overnight showed U.S. existing-home sales fell more than expected in March. Figures for new-home sales will be released later in the day.

Those may provide some pointers to the state of the U.S. economy. A clearer picture should emerge from the gross domestic product report set for release on Friday.

Support for the dollar came amid a general drop in market volatility. Expected moves in the euro/dollar exchange rate over a one-month period held near a five-year low of 4.50 vol.

The dollar's moves against the euro and sterling were small, with the single currency lower at $1.1243 and the pound up at $1.2986.

(Reporting by Saikat Chatterjee, additional reporting by Daniel Leussink in Tokyo; editing by Larry King)

Editor: Hasbi Maulana