Ukraine declares cease-fire after US expands sanctions

Ukraine announced a week-long unilateral cease-fire in its easternmost regions after the US imposed sanctions on people linked to the insurgency and accused Russia of providing new military aid to separatists.

Ukraine called on all fighters to lay down arms, halting the government offensive against rebels until June 27, the Interior Ministry in Kiev said in a website statement, citing President Petro Poroshenko.

The Treasury Department sanctioned seven individuals, including the acting governor of Sevastopol in Crimea and separatist leaders in the Luhansk and Donetsk regions, according to a statement issued on Friday in Washington. Further industrywide measures are being readied against companies in finance, defence and technology, a US official said.

"The United States will continue to take action to hold accountable those persons engaged in efforts to destabilise Crimea and eastern Ukraine," Undersecretary for Terrorism and Financial Intelligence David Cohen said in the statement.

"These individuals have all contributed to attempts to illegally undermine the legitimate government."

The U.S. is levying penalties for the first time since April 28, when it sanctioned people and companies linked to Russian President Vladimir Putin's inner circle. Russia risks further measures when European Union leaders meet next week unless it helps end the unrest to support an emerging peace plan, German Chancellor Angela Merkel said today.