Ukraine crisis: US and EU to intensify Russia sanctions
The US and EU are preparing to impose fresh sanctions against Russian individuals and companies.
The move comes amid continuing action by pro-Russian separatists in Ukraine.
Western nations accuse Moscow of supporting separatist gunmen who are occupying official buildings in cities across eastern Ukraine.
The separatists continue to hold seven Western military observers who were seized last week in the region.
Meanwhile, officials say the mayor of the eastern Ukrainian city of Kharkiv, Hennadiy Kernes, is in a serious condition after being shot in the back.
Monday also saw pro-Russian separatists seize a local government building in Kostyantynivka, the latest move in a campaign of defiance against the government in Kiev that has encompassed a dozen other cities in eastern Ukraine.
Gunmen wearing uniforms with no insignias moved into the building and raised the flag of the self-proclaimed "Donetsk Republic".
They were also reported to be in control of the police station in the town, which is located between the town of Slavyansk and the city of Donetsk, both also controlled by separatists.'Not personal'
US President Barack Obama confirmed the stepping up of sanctions, which he said was part of a "calibrated effort" to change Russia's behaviour in Ukraine, during a visit to the Philippines.
He said the measures were in response to Moscow's failure to uphold an international accord aimed at peacefully resolving the Ukraine crisis.
Mr Obama said the sanctions - which will be announced in detail later in Washington - would target individuals and companies, as well as some high-tech exports to Russia. But he acknowledged it was uncertain whether they would have any effect.
He said they were not aimed at Russian President Vladimir Putin personally.
"The goal is to change his calculus with respect to how the current actions that he's engaging in could have an adverse impact on the Russian economy over the long haul," he said.
Meanwhile, ambassadors from the 28 EU member states are meeting in Brussels to agree new sanctions against Russia.
The US and EU already have assets freezes and travel bans in place targeting a number of Russian individuals and firms accused of playing a part in the annexation of Crimea last month.
BBC Europe correspondent Chris Morris says it is expected that the ambassadors will add another 15 people in positions of power to the list of those to whom sanctions apply.
Our correspondent says the White House wants a show of unity from the US and Europe, but there is little consensus within the EU at the moment for implementing broader economic sanctions against Russia.'Revolting'
Eight foreign observers - who were operating under the auspices of the Organization for Security and Co-operation in Europe (OSCE) - were led into Sloviansk town hall by masked gunmen and shown to the media on Sunday.
German monitor Col Axel Schneider, who spoke for the group, stressed they were not Nato officers - contrary to claims made by the separatists - nor armed fighters, but diplomats in uniform.
Later, one of the group - a Swede - was freed for medical reasons.
Germany strongly criticised the group's appearance before the media.
"The public parading of the OSCE observers and Ukrainian security forces as prisoners is revolting and blatantly hurts the dignity of the victims," said a statement (in German) from Foreign Minister Frank-Walter Steinmeier.
He added that Russia had a duty to "influence" the separatists so that the other members of the mission could be freed as soon as possible.
Earlier, self-declared Sloviansk Mayor Vyacheslav Ponomaryov said there was the possibility of exchanging the monitors for militia members held by the Kiev government.
Russia, an OSCE member, has pledged to "take all possible steps" to secure the observers' release.
The fate of five Ukrainian military officers accompanying the mission is unknown.