NATO LEADERS ARE expected to announce a raft of fresh sanctions against Russia over its actions in Ukraine.

However, hopes remain that a ceasefire can be forged at peace talks in Minsk later today.

The leaders are heading into the second and final day of a NATO summit in Newport, Wales that has been labelled the most critical since the end of the Cold War for the Western military alliance as it addresses a multitude of crises from Ukraine to Iraq to Afghanistan.

They agreed on Thursday to set up new funds to help Ukraine’s military effort and treat wounded soldiers in a five-month conflict that has seen more than 2,600 people killed.

Ukrainian President Petro Poroshenko will be meeting with Russia and pro-Moscow rebels later today in an attempt to hammer out a peace deal. He has expressed “careful optimism” ahead of this meeting in Belarus.

Nato leaders are also expected to approve plans to position troops and military equipment in Eastern Europe to reassure ex-Soviet bloc member states unnerved by Russia’s recent actions in Ukraine.

‘Not one single step’

“While talking about peace, Russia has not made one single step to make peace possible,” Nato chief Anders Fogh Rasmussen said after Ukraine-focused talks at the leaders’ summit on Thursday.

“Instead of de-escalating the crisis, Russia has only deepened it,” he said, adding that previous Russian statements on peace had been “a smokescreen for continued Russian destabilisation of the situation”.

But Rasmussen left open the door to a seven-point peace plan put forward on Wednesday by Russian President Vladimir Putin, saying: “If we are witnessing genuine efforts for a political solution, I would welcome it”.

Earlier this week, the offfice of the Ukrainian president retracted a statement made which said Poroshenko and Russian president Vladamir Putin had agreed to a “permanent ceasefire”.

- © AFP, 2014

Read: Ukraine president to brief Western leaders before Welsh Nato summit >

More: Ukraine takes back comments about ceasefire with Russia >