North Korea may shell South again in 2010: report

TOKYO Thu Dec 2, 2010 5:13am EST

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TOKYO (Reuters) - North Korea could carry out shelling attacks against mainland South Korea before the year-end, the Tokyo Shimbun newspaper said on Thursday, citing an unnamed source knowledgeable about the North who had spoken with a North Korean official.

The euro slipped to about $1.3110 from $1.3135 and the Australian dollar also eased as news of the report circulated in the foreign exchange market and after big gains in those currencies overnight, but Tokyo shares were up 1.7 percent.

The North would target Gyeonggi province in northwest South Korea and would also try to damage South Korean warships in the Yellow Sea, the daily reported, citing the source, who it said spoke with a North Korean official after the North shelled a South Korean island last week, killing four people.

It was unclear if the North Korean official spoke on the basis of a specific plan, the newspaper said.

Threats from North Korea are not new, and its KCNA news agency warns of outright destruction of the South on an almost daily basis. The South's spy chief said on Wednesday that the North is highly likely to attack South Korea again.

(Reporting by Yoko Kubota and Charlotte Cooper; Editing by Michael Watson)

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