The Ukrainian government has agreed a ceasefire with pro-Russian rebels in the east of the country.
Ukraine's President Petro Poroshenko confirmed on his Twitter account that a peace plan had been signed, while pro-Russian rebels also announced the news on the social media site.
The deal came into force at 4pm UK time, but just minutes later a number of explosions were reported north of the eastern city of Donetsk.
Mr Poroshenko, who has been attending a Nato summit in Wales, said the agreement followed a phone conversation with his Russian counterpart Vladimir Putin.
"Human life is the highest value and we must do everything possible and impossible to end the bloodshed and the suffering," said the Ukrainian President.
Ukrainian soldiers respond as separatists fire heavy artillery in Mariupol The United Nations has put the death toll in the five-month conflict at more than 2,600.
Mr Poroshenko said 12 steps, including a decentralisation of powers, the provision of humanitarian aid and the release of prisoners on both sides, had been agreed under the terms of the ceasefire.
Prime Minister David Cameron said sanctions against Russia announced last weekend would come into force despite the truce - but could be lifted if a lasting peace was found.
US President Barack Obama added that, as things stood, the West was preparing to "deepen and broaden" sanctions.
On the ceasefire, Mr Obama said he was "hopeful but based on past experience also sceptical that the separatists will follow through and the Russians will stop violating Ukraine's sovereignty and territorial integrity".
A man repairs the damage to a building caused by shelling in Donetsk Talks have been taking place between Ukraine and pro-Russian rebels in the Belarussian capital, Minsk. Officials from Russia and the OSCE security watchdog have participated.
Separately, Ukraine's Prime Minister Arseny Yatseniuk said in a televised cabinet meeting in Kiev that the peace plan must include three key elements - a ceasefire, the withdrawal of "Russian forces and Russian bandits and terrorists" and the restoration of Ukraine's state border with Russia.
A rebel offensive in south-east Ukraine in the last two weeks has turned the tide of the war against Ukrainian forces, who until recently had appeared close to crushing the rebellion.
Sky's Katie Stallard, who is on eastern city limits of Mariupol, said soldiers from both sides remained in position and that it was difficult to see the ceasefire holding "long term".
David Cameron said sanctions would stand despite the truce "No one has much faith in the ceasefire here," she said.
"There is scepticism about the timing. President Putin has come up with the peace plan right at the point European leaders were preparing to finalise tougher sanctions on Russia.
"What this also doesn't resolve is that we're hearing from the self-proclaimed prime minister of the Lugansk People's Republic, who is saying that this ceasefire doesn't address the status of their 'republic' and they do not abandon their plans to separate from Ukraine."
Meanwhile, Nato announced plans to create a 'Spearhead' rapid response force to counter Russian aggression in Ukraine.
But Moscow said joint military exercises planned by Kiev and Nato in Ukraine - and announced along with the Spearhead force - could undermine peace moves.
Russia's foreign ministry said in a statement that military exercises - planned for September 16-26 - would cause "increased tensions, threaten the tentative progress in the peace process in Ukraine and contribute to the aggravation of a split in the Ukraine society."
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