Beginning Knitting Project for Baby?

I have just gotten back into knitting after only trying it as a kid. I'm surprised I remember, but I'm really enjoying it! I'm working on a couple of scarves to get the hang of it again, but my sister-in-law just had a baby. I'd like to make something for Christmas, but something not too big or hard since I'm learning. I have some 4mm needles and small baby yarn in two colors I'd like to do something with. Does anyone have any suggestions?

Thanks,
DanaK