An internal White House review of strategy on North Korea reportedly includes the possibility of direct military action or regime change to counter the hermit kingdom's nuclear threat.

Deputy national security adviser K T McFarland held a meeting with other officials to discuss the US response to a fresh series of provocations from the North, the Wall Street Journal reports.

Ms McFarland requested for all options to remain open with regard to American foreign policy towards Pyongyang, including for the country to recognise North Korea as a nuclear state and the possibility of a direct conflict.

The proposals are now being vetted prior to review by President Donald Trump.

Abe and Trump condemn North Korea's latest missile launch

It comes as South Korea and the US agreed last week to strengthen cooperation on financial sanctions against North Korea after Pyongyang's latest ballistic missile test last month.

US Treasury Secretary Steven Mnuchin and South Korea Finance Minister Yoo Il-ho expressed "great concern" over North Korea's ballistic missile test and promised to follow through with United Nations sanctions, as well as their own, the South Korean ministry said in a statement after a call between the pair.

North Korea has condemned the start of annual US-South Korean military drills with fiery rhetoric, threatening to "mercilessly foil the nuclear war racket of the aggressors with its treasured nuclear sword".

A spokesman for the General Staff of the North Korean People's Army said the North's reaction will be the toughest ever, but did not elaborate.

Inside the daily life in North Korea Show all 19 1 /19 Inside the daily life in North Korea Inside the daily life in North Korea People reading a newspaper at the metro station Inside the daily life in North Korea Thoughts of the leaders on the tram. They have about a dozen of these on every tram, all with different thoughts Inside the daily life in North Korea Young people training for a big upcoming festival Inside the daily life in North Korea People at the Pyongyang's annual marathon Inside the daily life in North Korea Many stars on one of the trolleys in Pyongyang Inside the daily life in North Korea An intimidating poster in a primary school in North Korea. Inside the daily life in North Korea Solar panels installed on a street lamp. Inside the daily life in North Korea A poster on the window next to one of the venues we visited in Pyongyang Inside the daily life in North Korea Kids playing football next to the Arch of Triumph. After a while tourists were allowed to join, so some of us did Inside the daily life in North Korea Class in an educational center in Pyongyang (where people over 17 years old can attend any classes they choose after school, for free) Inside the daily life in North Korea People waving at me during the Pyongyang marathon Inside the daily life in North Korea People having a great time dancing at a public park Inside the daily life in North Korea A metro driver in a metro station in Pyongyang Inside the daily life in North Korea Fireworks to mark the birthday of the Eternal President Kim Il Sung on our last night in Pyongyang Inside the daily life in North Korea My wonderful tour guide at a public park Inside the daily life in North Korea One of the parks in Pyongyang Inside the daily life in North Korea A person rowing some boats for the day at a river in Pyongyang Inside the daily life in North Korea The National War Museum Inside the daily life in North Korea Public park in Pyongyang

South Korea's military said it will "resolutely" punish North Korea if provoked.

The US has 28,500 troops stationed in South Korea as a deterrent against potential aggression from the North.