In a rare gesture, North Korean leader Kim Jong-un has invited South Korean President Moon Jae-in to hold inter-Korean dialogue in Pyongyang. Kim's sister, Kim Yo-jong, personally delivered the message as she was in Seoul for the Winter Olympics.

Tensions in the Korean peninsula have cooled down in recent weeks thanks to the North Korean regime's decision to send its athletes to take part in the Olympic games. The marked development comes after months-long tensions in the region filled with aggressive military manoeuvres, missile launches and nuclear tests.

"We would like to see you at an early date in Pyongyang," the North Korean leader's younger sister, a close aide of the leadership, told Moon in a meeting on Saturday.

Moon is set to take the invitation with both optimism and caution as he is expected to walk a fine diplomatic line over the matter. This will also be challenging for the Moon administration given the continuing approach by the US, South Korea's key ally, to exert maximum pressure on North Korea to abandon its weapons programmes. The Trump administration is still wary of any kind of engagement with the North.

Demonstrating a non-committal stance, Moon said about the invitation that he wants to "create the environment for that to be able to happen". Additionally, he urged the hermit kingdom to "actively pursue" efforts to hold dialogue with the US.

Already there have been concerns that North Korea's overture of the sports diplomacy is an indirect attempt by the regime to wedge a rift between the US and South Korea. Leaders of the rival Koreas have not met in more than a decade on any platforms.

"The South and North shared an understanding that they should continue the positive mood for peace and reconciliation created by the Pyeongchang Olympics and should promote inter-Korean dialogue, exchanges and cooperation," Moon's office said in a statement.