SEOUL North Korea prepared for the annual celebration of its founder's birth on Monday, having rejected talks with South Korea aimed at reducing tensions and reopening a joint industrial park between the two countries.
The North has threatened for weeks to attack the United States, South Korea and Japan since new U.N. sanctions were imposed in response to its latest nuclear arms test in February.
Speculation has mounted of a new missile launch or nuclear test in a bid to either force Washington to hold talks with Pyongyang or to shore up the leadership of Kim Jong-un, the grandson of the reclusive state's founder.
The third Kim to rule in Pyongyang attended a midnight celebration of his father and grandfather's rule with top officials including his kingmaker uncle Jang Song-thaek and the country's top generals.
In Tokyo on Sunday, U.S. Secretary of State John Kerry again offered talks if North Korea abandoned its nuclear weapons programme, which Pyongyang describes at its "treasured" sword.
Kerry's trip to South Korea, China and Japan was aimed at reassuring its allies and putting pressure on Beijing to act decisively to implement the United Nations sanctions.
North Korea has repeatedly stressed that it fears Washington wants to invade it and has manipulated the United Nations to weaken it. At the weekend, Pyongyang rejected an overture by new South Korean President Park Geun-hye as a "cunning" ploy.
"We will expand in quantity our nuclear weapons capability, which is the treasure of a unified Korea ... that we would never barter at any price," Kim Young-nam, North Korea's titular head of state, told a gathering of officials and service personnel applauding the achievements of Kim Il-Sung.
Kim Il-Sung's birthday is usually marked with a mass parade to showcase the North's military might. In 2012, following the death of his father, the 30-year old Kim Jong-un made a public speech, the first in living memory for a North Korean leader.
(Additional reporting by Arshad Mohammed and Kiyoshi Takenaka in TOKYO)