In a parliamentary hearing, Unification Minister Chung Dong-Young denied media reports that Seoul had given Pyongyang a June deadline to return to the talks which last convened in June 2004.

"It is nothing but groundless speculation," he said in answer to lawmakers' questions, ading that deadlines would only inject further tension into the standoff.

Chung, however, did say, that as the anniversary of the last round of talks approached, the situation had reached a turning point.

"The situation is at the crossroads of peace and crisis," said Chung, who declined to elaborate on what he mant by crisis..

South Korea, China, Japan, Russia and the United States have urged North Korea to come back to six-way talks since the communist state failed to show up for a fourth round set for September 2004, citing "hostile" US policy among other reasons.

US Secretary of State Condoleezza Rice, who visited Asia last month and held meetings with Chinese, South Korean and Japanese leaders, recently warned that North Korea faced "problems" if it failed to return and Washington was looking at "other options" to diplomacy to end the standoff

Scorning the calls for a return to talks, North Korea has instead further ratched up tensions by declaring itself a nuclear power on a par with the United States. It says it no longer wants to bargain away its nuclear weapons for rewards and is instead seeking broader disarmament talks involving the US.

"We analyse the series of North Korean moves as aimed at attempting to shift its defensive position to the offensive one," Chung said.

The nuclear standoff erupted in 2002 when Washington accused Pyongyang of operating a secret uranium-enrichment programme.

The United States believes that North Korea may have two crude nuclear devices. Experts say it may have reprocessed enough plutonium for half a dozen more.

Thomas Byrne, vice president of Moody's Investors Service, told a seminar Tuesday that the nuclear issue poses little threat to South Korea's sovereign credit rating, Yonhap news agency said.

Moody's currently maintains an "A3" rating on South Korea's long-term foreign currency debts with a stable outlook.

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