North Korea test-fired another short-range missile off its east coast today and said it would take more "self-defence measures" if the UN Security Council punished it for this week's nuclear test.
South Korea said an increasingly aggressive North may be preparing fresh moves after Chinese fishing boats were spotted leaving a disputed sea border on the west coast.
South Korea and the United States have raised the military alert level in the region after the isolated state followed Monday's nuclear test with missile launches and a threat of war.
Regional powers are waiting to see what the North might do next.
Many speculate it may opt for a naval skirmish in disputed waters off the west coast, which should be getting crowded as the lucrative crab fishing season starts.
In New York, the United States and Japan circulated a draft UN Security Council resolution to key members, condemning Pyongyang's second nuclear test and demanding strict enforcement of sanctions after the North's first atomic test in October 2006.
In a draft seen by Reuters, the Security Council resolution "condemns in the strongest terms" the North's test and calls for enforcement of sanctions imposed after Pyongyang's first 2006 nuclear test, which included a limited trade and arms embargo that had been widely ignored.
However, initial US testing to determine whether North Korea fired a nuclear device on Monday proved "inconclusive," a US officialsaid today.
"The first test results came in inconclusive. They did not find anything that could confirm a nuclear device was detonated," said the US official, who declined to be named.
North Korea, in its first response to threatened sanctions, said it would take "self-defence measures" if it was punished.
It gave no details other than to say such a move would nullify the armistice that ended the 1950-53 Korean War. It has previously said that truce was already dead.
Yonhap quoted an unnamed government source as saying the North fired the short-range rocket from its Musudan-ri missile base around dusk, making it the fifth to be launched since the nuclear test. Most of the missiles are believed to have a range of around 130km.
Australian prime minister Kevin Rudd today called for tough financial sanctions against North Korea, saying they were the only measures likely to influence the state.
"The measures have to be uniform and strong ... One of the only effective ways of seizing the attention of the government in Pyongyang is by a harsh range of financial measures," Mr Rudd told an annual meeting of Asian defence ministers in Singapore.
"I believe they need to be re-embraced and hardened," Rudd told the Shangri-La Dialogue, at which U.S. Defence Secretary Robert Gates was due to meet his counterparts from South Korea and Japan tomorrow to discuss action on the North.
"Those in North Korea only respond to a unified demonstration of strength on the part of the international community," Mr Rudd said. "The first test of strength will be what measures we embrace as an international community through the UN Security Council."
The two Koreas have fought two deadly naval skirmishes on their disputed maritime border in the past 10 years and the North has warned another could happen soon.
"Our forces are watching these movements (by Chinese fishing boats) with the view that they could be signs that indicate the possibility of North Korea's aggression," Defence Ministry spokesman Won tae-jae said.
The 1999 and 2002 clashes were in June, the peak of the three-month crab season when fishing fleets jockey for the best spots near the contested maritime border.
Reuters