The North has carried out two atomic tests and dozens of missile launches since the beginning of previous year in its quest to develop a missile capable of delivering a nuclear warhead to the continental United States - something President Trump has vowed "won't happen".
Of the North's missile test, South Korea's Joint Chiefs of Staff said in a statement that the launch came from the North Korean eastern coastal town of Wonsan, and that the projectiles likely flew about 125 miles with an apogee of more than 1 mile.
North Korea is also closely watching Japan's moves.
This picture taken on May 14, 2017 and released from North Korea's official Korean Central News Agency (KCNA) on May 15 shows North Korean leader Kim Jong-Un inspecting a ground-to-ground medium long-range strategic ballistic rocket Hwasong-12 at an undisclosed location.
The new launch is the latest in its series of missile tests defying world pressure and threats of more sanctions.
"The only things North Korea can gain from these provocations are economic isolation and economic difficulties", Moon apparently conceded at a National Security Council meeting.
North Korea's weapons tests are meant to build a nuclear and missile program that can stand up to what it sees as USA and South Korean hostility, but they are also considered by outside analysts as ways to make its political demands clear to leaders in Washington and Seoul. He has signaled a softening stance toward North Korea by encouraging aid groups to visit the country, although the North has rejected those offers since Seoul supported new United Nations sanctions.
Pyongyang is expected to demand the return of all four fishermen by accusing Seoul of enticing them to defect to the South.
Roh Jae-cheon, spokesman of Seoul's military, said the latest launch would have meant to show off its widening arrange of missiles and also its "precision strike capabilities" on ships in response to the joint drills.
The launches Thursday were North Korea's fourth missile test since Moon's inauguration on May 10. The improved range indicates the North is pursuing weapons capable of reaching USA aircraft carriers that operate from deeper positions, he said.
The country already fired 16 missiles in 2017, The launch came only a day after South Korea's Moon Jae-in delayed the deployment of a USA missile defense system.
North Korea fired multiple cruise missiles into the waters between Korea and Japan on Thursday morning, a day after Seoul said it would suspend any further deployment of a controversial missile-defense system to conduct an environmental review.