Wary Of 'False Flag' In Donbas, No Indication Of Further Violence Yet

Earlier this morning wire reports of the Ukrainian miltary stating that Russian Occupying Forces were shelling villages in the Donbas gained significant media and market attention. Shelling and the exchange of fire along the line of control in the Donbas (the divider between Ukrainian forces and separatist rebels) is a frequent occurence, and would not usually gain such significant attention. However, the tense situation in the region has understandably made each headline a potential signal of imminent conflict.

• The main reports centre around the shelling of a kindergarten in the village of Stanytsia Luhanska. Each side has claimed that the other was firing. Given that this village is under the control of the Ukrainan gov't, the most likely scenario is one in which separatist rebels engaged in shelling, with Ukrainian forces potentially responding in kind.
• Reports of violence in the Donbas should not be totally discounted though. There remain concerns in Ukraine and the West that a 'false flag' operation, where separatists or ethnic Russian enclaves are fired upon supposedly by Ukrainian gov't forces provides Russia the pretext to launch a military incursion in order to 'defend' ethnic Russian minorities in the region.