The United States pressed China on Monday for joint action against North Korea, at the start of high-level talks aimed at putting an end to months of discord, notably over currency and trade disputes.

US Secretary of State Hillary Clinton and Treasury Secretary Timothy Geithner are leading a huge delegation to the Strategic and Economic Dialogue -- two days of discussions that come at a sensitive time in Sino-US relations.

The two countries are looking to move forward on a number of issues including the value of the yuan -- with the US hoping for some kind of Chinese pledge to let it appreciate -- lingering trade spats and Internet freedom.

In a sign of the importance Washington has given to the meeting between the world's number one and three economies, about 200 officials have come to Beijing -- a number which Clinton said she believed was unprecedented.

"Our economies have become increasingly inseparable," Chinese Vice Premier Wang Qishan, who is leading Beijing's delegation along with State Councillor Dai Bingguo, said at the opening ceremony in the Great Hall of the People.

In her opening speech, Clinton said: "We will not agree on every issue but we will discuss them openly," as she cited human rights concerns.

"Our future, both our challenges and our opportunities, will be shared. Ultimately, this is what this dialogue is about."

Later in the day, both Clinton and Dai said the talks had gotten off to a "good start".

The strategic part of the dialogue led by Clinton is expected to focus on Korean tensions after a multinational investigation last week blamed Pyongyang for sinking a South Korean naval vessel in March.

The panel said a North Korean submarine torpedoed the corvette Cheonan, killing 46 sailors.

Demanding North Korea "stop its provocative behaviour," Clinton also called on China to cooperate with the United States to deal with the situation.

"We must work together to address this challenge and advance our shared objective of peace and stability on the Korean peninsula," she said.

Chinese officials -- who feted North Korean leader Kim Jong-Il with red-carpet treatment during a visit to China last month as the Cheonan incident was raging -- again called for restraint Monday, as it did last week.

"China hopes the parties will maintain calmness and restraint and properly deal with relevant issues," Chinese foreign ministry spokesman Ma Zhaoxu said, according to the state Xinhua news agency.

South Korea on Monday cut off trade with Pyongyang and pledged to take the matter before the UN Security Council, where China, the North's sole major ally, is one of five veto-wielding members.

The White House also offered Seoul its "full support" and said Washington would work with its allies to "reduce the threat that North Korea poses to regional stability".

"We're in the midst of very intensive consultations with the Chinese government on this issue," Clinton said, adding that the Chinese "recognise the gravity of the situation we face" and understand South Korea's reaction.

The two sides hope to make progress on other key bilateral issues dogging their relations, which hit a rocky patch earlier in the year over US arms sales to Taiwan, US President Barack Obama's meeting with the Dalai Lama and trade.

Geithner -- under pressure from US lawmakers to push China to allow the yuan to rise -- has of late instead highlighted complaints that Beijing has skewed its trade and investment rules in favour of homegrown firms.

"Our common interests lie in supporting a more open global trading system, with a fair balance of benefits and responsibilities, in which countries are able to compete on a level playing field," Geithner said Monday.

"Our two countries have benefited greatly from open trade and investment, and we welcome a more open China today."

Chinese President Hu Jintao, addressing officials before the talks began in earnest, reiterated that Beijing would make "gradual progress" on the yuan, and adjust its exchange rate policy at its own pace.

China's central bank governor Zhou Xiaochuan said the yuan issue had been raised in Monday's talks, according to Dow Jones Newswires.

The standoff over Iran's nuclear programme, climate change and energy cooperation are also on the agenda.

Clinton said a draft Security Council resolution calling for sanctions against Tehran "sends a clear message", adding: "The burden is on Iran."