The Kremlin said in a statement that Putin "calls on the opposing sides to halt any military activities and sit down at the negotiating table."
The statement said Putin supported Ukrainian President Petro Poroshenko's decision to order Ukrainian troops to observe a unilateral cease-fire starting Friday night.
Poroshenko bills the weeklong cease-fire as the first step in a wider peace plan that would include an amnesty for pro-Russian separatist fighters.
Putin said however that without action directed at starting talks, the plan was "not viable and unrealistic."
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Ukraine and the United States have accused Russia of supporting the insurgency, including by permitting tanks to cross the border and wind up in the rebels' arsenal. Russia counters that it is not supporting the insurgents and Russians who have joined the fighting are doing so as private citizens.
The US and European leaders have called on Russia to play a constructive role in settling the conflict and halt what they say is support for the rebels. The US and Europe have placed targeted financial sanctions on some Russian officials but have held off on targeting entire economic sectors.
The more conciliatory tone of the Kremlin statement contrasted with Putin's move today to order military forces in central Russia to observe a combat alert and to launch an exercise for airborne troops.