Economic chiefs of South Korea and the United States agreed to strengthen their policy coordination at a time when inter-Korean relations are facing a dramatic turn, Seoul's finance ministry said Sunday.

South Korean Finance Minister Kim Dong-yeon held a meeting with his US counterpart Steven Mnuchin in Washington on Saturday on the sidelines of the G-20 finance ministers and central governors meeting.

They shared the view that it is a critical time for the two countries to engage in close policy coordination, and agreed to continue talks on key pending issues, such as currency market transparency.

On Saturday, North Korea said it will suspend nuclear and missile tests and shut down its atomic test site, in a surprise announcement that could give momentum to its upcoming summits with South Korea and the US.

The US Treasury Secretary also gave a positive assessment of the Seoul government's move to improve the transparency of its currency market, according to the finance ministry.

Seoul said earlier that the country is considering the detailed disclosure of its interventions in the foreign exchange market as part of a broader move to boost transparency and clear itself of suspicion of exercising undue influence on exchange rates.

South Korea's financial authorities have persistently claimed they do not interfere in the foreign exchange market but engage in "smoothing operations" against extreme one-sided movements.

Early this month, Washington kept South Korea on its "monitoring list" but did not designate it as a currency manipulator.

The United States has vowed to aggressively keep tabs on and combat unfair currency practices, saying the US cannot and will not bear the burden of an international trading system that, it claims, unfairly disadvantages American exports and gives an edge to its trading partners.(Yonhap)