By Alistair Bunkall, Defence Correspondent
Tough new measures designed to halt Russian aggression in Ukraine will be unveiled on the second and final day of a Nato summit in Wales.
The United States and European Union are to come together later to announce a new round of co-ordinated economic sanctions against Russia, US and British government sources have reported.
These are set to include restrictions on some of the country's all important energy firms as well as travel restrictions.
Speaking on the sidelines of the Nato summit on Thursday, Deputy White House national security adviser Ben Rhodes said: "The key point is that Russia must continue to face costs for its own escalation.
"If Russia escalates, we can escalate our pressure."
The conflict in Ukraine is set to top the agenda for the second day of the Nato summit, with western leaders accusing Russia of sending thousands of troops into the east of the country.
Nato Secretary General Anders Fogh Rasmussen has warned that Russia's incursion poses the most serious security threat to Europe since the Cold War, although Moscow has consistently denied direct military involvement.
Nato is also expected to finalise plans for a Rapid Reaction Force that can deploy to Eastern Europe on 48 hours notice.
This will include pre-positioning logistic and planning support in Baltic countries as well as vital equipment.
Nato insists this does not breach a 1997 agreement not to create permanent bases near the Russian border.
The measures will come a day after British Prime Minister David Cameron, US President Barack Obama and other senior Nato leaders met Ukrainian President Petro Poroshenko.
Mr Poroshenko has announced plans to order a ceasefire, provided a peace plan is agreed during separate talks in Minsk, attended by representatives from Ukraine, Russia and pro-Russian rebel forces.
Russian President Vladimir Putin has also expressed hopes a truce will come into force later, two days after he unveiled his own seven-point peace plan.
Alongside Ukraine, Nato leaders will use the final day of the summit to discuss the threat posed by Islamic State extremists in Iraq and Syria.
Last night the Alliance leaders met for a formal dinner at Cardiff Castle.
US President Barack Obama is trying to bring together a coalition of nations.
It is becoming increasingly likely the UK will authorise air strikes against IS in northern Iraq.
But for any operation to be effective, it needs the support and involvement of countries in the region.
Nato is encouraging Iraq to request training support for its military although it will not go further and involve itself in a combat mission.
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