The Russian rouble has fallen ahead of talks aimed at bringing an end to fighting in eastern Ukraine. David Pollard asks how big an impact a peace deal would have?
The aftermath of the latest fighting in rebel-controlled Donetsk. Scenes like this are deepening fears that the violence in eastern Ukraine is reaching a new tipping point. And adding impetus to efforts to bring it to an end. Even Russian foreign minister Sergei Lavrov talking of hopes of progress ahead of the latest peace talks - if the right conditions are met. (SOUNDBITE) (Russian) RUSSIAN FOREIGN MINISTER SERGEI LAVROV, SAYING: "We are convinced that the situation in Ukraine cannot be resolved by military means. The path to peace lies through a direct dialogue between Kiev authorities and those who want to defend their land in the south-east. And we should protect their rights, rights of everyone who live in Ukraine." It's a high stakes meeting here at Independence Palace in Minsk - with Angela Merkel and Francois Hollande, alongside Vladimir Putin and Ukrainian leader, Petro Poroshenko. And it's been met with a mixed reaction by observers - and by markets In early trading, the rouble was down over a percent against both the dollar and the euro. Russian stocks, though, warming to the prospect - with both key indices rising strongly early in the day. But progress beyond an agreement to carry on talks is unlikely at this meeting, says Admiral Markets' commentator, Darren Sinden. Unless Ukraine considers something it's refused to look at so far. SOUNDBITE (English) DARREN SINDEN, MARKET COMMENTATOR, ADMIRAL MARKETS, SAYING: ''I think a bit of realpolitik might creep in, and despite the Ukrainians' insistence that they don't want the country to be broken up, there may be a case for looking to allow a certain amount of self-determination in the far east of the country who do want to look to Moscow rather than Kiev for their government.'' Despite the drop on the day, the rouble has been gaining on the prospect of peace talks. But more volatility could lie ahead as traders jump on every shred of news from the talks. A lack of any real move towards a deal likely to push it firmly downward again.