Ukraine's Security Council has said preliminary information indicated that missiles which brought down two government fighter jets over eastern Ukraine were fired from Russia.

"Two of our jets were hit at an altitude of 5,200 metres.

"According to preliminary information, the missiles were launched from the territory of the Russian Federation," the council said in a statement.

A spokesman for Ukraine's military operations said the jets were downed near Savur Mogila in eastern Ukraine.

One military spokesman earlier said the planes were brought down about 25km from the crash site of Malaysian Airlines flight MH17.

However, a second spokesman said the jets had been downed at a different location by rockets fired by insurgents.

The two pilots managed to parachute out, he said.

This morning, Ukrainian military officials said pro-Russian rebels were leaving their positions on the outskirts of Donetsk and retreating towards its centre.

Residents said the rebels, who want independence from Kiev for Ukraine's Donbass region, had dug trenches in downtown Donetsk outside the main university, where they have been living in student dormitories.

Ukrainian forces have forced the rebels back to their two main strongholds of Donetsk and Luhansk, taking villages and suburbs around them to try to squeeze them out.

"In Donetsk, rebels abandoned their positions en masse and went towards the central part of the city," the headquarters of what Kiev calls its "anti-terrorist operation" said in a statement.

"It cannot be ruled out that the appearance of such movements could suggest the spread of panic and attempts to leave the place of warfare."

Residents said they had heard shelling during the night and a shell struck a chemical plant in the city, causing a fire.

Fighting was also reported in Luhansk overnight, officials in Kiev said.

EBRD 'unable' to approve new investment in Russia

The European Bank for Reconstruction and Development has said that a majority of its board of directors had given it "clear guidance" that they would be unable to immediately approve new investment in Russia.

The statement from the bank comes a week after the EBRD said it would consult all of its shareholders on the implications of the European Union's call for it and the European Investment Bank (EIB) to suspend new lending in Russia.

"Their guidance follows a declaration by last week's European Council which called on the EU member states to coordinate their positions within the Bank's Board. The EBRD management will be guided by this in its operational approach in Russia," the EBRD said in a statement.

The Board of Directors represents all EBRD shareholders which consist of 64 member states, the European Union and the European Investment Bank.

The EBRD said, however, that it would continue to manage its portfolio of existing projects in Russia and would maintain its physical presence there.

Russia has traditionally been the biggest recipient of the London-based EBRD's funds - it lent €1.8 billion there last year. The EIB pledged to lend more than €1bn to Russia last year.

In the first six months of 2014, Russia accounted for 19% of the bank's investments. During this period, investments in all the countries of operations were a record €3.6bn, the statement added.