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Ukraine trades accusations with Russia over border shelling

Pro-Russian fighters ride a airborne self-propelled artillery gun Nona in downtown Donetsk, eastern Ukraine Thursday, July 24, 2014. While the downing of Malaysia Airlines flight MH17 last week riveted international attention on the Ukraine conflict, locals have been struggling for months with spiraling violence. The Ukrainian military, buoyed after the fall of rebel stronghold Slovyansk this month, is now trying to encircle Donetsk and cut off any supply routes from Russia.

KIEV, Ukraine — Ukraine and Russia traded accusations of cross-border shelling Friday as tensions between the ex- Soviet neighbors intensified.

"Ukraine's border checkpoint at Marynivka in the Donetsk region was attacked from Russian territory by mortars, Grad missile systems and artillery," at 6 p.m. and 11 p.m. local time Thursday, damaging infrastructure and equipment, a Ukrainian Defense Ministry spokesman, Andriy Lysenko, said in Kiev Friday.

Rossiya 24 state television said about 40 artillery shells landed in the Rostov region of southern Russia from across the border and one woman may have been injured. It showed pictures of unexploded shells near a border post.

While both countries have swapped such accusations before, the latest allegations come as the pro-Russian rebel stronghold of Donetsk, less than 60 miles from the Russian border, awaits a possible onslaught by Ukrainian government forces.

The July 17 downing of Malaysian Air Flight 17 over eastern Ukraine, killing 298 passengers and crew, has dashed at least temporarily any chances of a de-escalation in the struggle between the rebels and the government in Kiev. Russian President Vladimir Putin is facing intense pressure to expedite the investigation into the crash, which the United States says was probably caused by a Russian-supplied missile.

Amid the threat of broader sanctions against Russia by the European Union, the central bank in Moscow unexpectedly increased borrowing costs Friday for a third time this year. The bank raised its one-week auction rate to 8 percent from 7.5 percent, according to a statement on its website. None of the economists surveyed by Bloomberg predicted an increase.

The ruble traded 0.4 percent weaker at 35.1125 against the dollar as of 6:34 p.m. in Moscow. It's been the worst performer among 24 emerging-market currencies tracked by Bloomberg since the U.S. expanded sanctions against Russia July 16. The Micex stock index declined 1.5 percent.

Ukrainian government bonds fell to a three-week low, with the yield on the dollar bond due July 2017 up for a second day, gaining 22 basis points to 8.85 percent, the highest level since July 7. The hryvnia weakened 1.5 percent to 11.91 per dollar by 4:02 p.m. in Kiev, according to data compiled by Bloomberg.

As Ukraine pushed forward with its ground offensive to regain territory lost to the rebels, separatist leader Alexander Borodai said he's preparing for block-to-block fighting to defend Donetsk.

"We will stand till the end," Borodai, the prime minister of the self-proclaimed Donetsk People's Republic, said in an interview Thursday. "If the Ukrainians start an offensive, it will become a second Stalingrad," he said, referring to the World War II battle that claimed almost 2 million Soviet and German lives.

Ukraine's parliament went into recess Friday without voting on the resignation of Prime Minister Arseniy Yatsenyuk, who said Thursday he'd step down after the ruling coalition broke apart while voting over the costs of funding its army and keeping a bailout deal afloat.

Parliament has 10 days to vote on the resignation, with the government in place until a new administration is named.

"The government's status hasn't changed," Yuriy Yakymenko, head of the political department at the Kiev-based Razumkov Center, said by phone. "Its resignation hasn't been formally recognized. It's only Yatsenyuk who left."

Deputy Premier Volodymyr Hroisman was named as acting premier Thursday night.

Two parties pulled out of the ruling coalition yesterday to open the way for early parliamentary elections. Lawmakers subsequently failed to pass two government-proposed bills, including one on funding the military and cutting social spending required under Ukraine's $17 billion International Monetary Fund aid deal.

The government called for an extraordinary session to vote on the budget laws, according to a statement on its website. The coalition parties are still political allies and will have to find a way out of the situation, while the government should still be able to negotiate with the IMF, Yakymenko said.

The U.S. raised the allegations of Russian cross-border fire Thursday, marking the first time American officials have publicly alleged direct Russian participation in fighting on behalf of the separatists.

"Russia is firing artillery from within Russia to attack Ukrainian military positions," State Department spokeswoman Marie Harf told reporters in Washington. She said the information came "from our intelligence friends."

The U.S. allegations are at odds with Russian denials that the country is aiding the rebels fighting the government in eastern Ukraine.

The Australian government is to send another 100 federal police officers to Europe to help in the investigation and recovery of the bodies of the 28 of its nationals who perished in the Malaysian plane, Prime Minister Tony Abbott told reporters in Canberra Friday.

"Others can engage in the politics of eastern Europe," Abbott said. "All we want to do is to claim our dead and to bring them home."

Australia has already sent 90 federal police to Europe who are working on efforts to identify the victims. The latest officers will take part in a possible international mission to secure the crash site. The government is also close to an agreement with Ukraine to deploy those police, who may be armed, to assist with the recovery of remains of the crash victims, Abbott said.

Meanwhile, 40 unarmed Dutch military police officers will leave for Ukraine tonight to help in the search for the remaining victims, the Dutch Defense Ministry said. Of those who died on the plane flying from Amsterdam to Kuala Lumpur, 194 had Dutch nationality.

Andras Gergely in Budapest, Edward Johnson in Sydney, David Lerman in Washington and Martijn van der Starre in Amsterdam contributed to this report.
 

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