New Zealand's largest city goes into three-day lockdown

New Zealand on Sunday reported three new locally acquired COVID-19 cases, the country's first since late January, when a returned traveller tested positive after leaving quarantine.

1 NEWS politics editor Jess Mutch McKay explains the steps officials have taken ahead of the latest community cases.

Prime Minister Jacinda Ardern has vowed to leave "no stone unturned" in the hunt for the source of the Valentine's Day Covid-19 outbreak.

The Pacific island nation has been widely praised for its handling of the pandemic, with just 25 deaths in a population of five million.

The New Zealand government imposed a lockdown for three days in the country's largest city Auckland from midnight Sunday after the discovery of coronavirus infections in a family.

Australia has temporarily suspended its one-way travel bubble from New Zealand for a second time following Auckland's new snap lockdown.

The rest of New Zealand has been placed at alert level two, which mandates social distancing, caps on gathering and increases mask wearing.

'I know we all feel the same way when this happens - "not again".

"We have stamped out the virus before, and we will do it again", Ardern said.

The father is self-employed in the building industry, and the daughter is a student at Papatoetoe High School, a school with 1400 students in the south of Auckland.

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The states will work to identify those who have recently arrived in Australia from New Zealand and assess their risk of transmitting coronavirus, the Department of Health said.

But he added it was "too soon to rule in or out" any source of transmission and the woman had not been at work for eight days before testing positive.

Air New Zealand has also responded to the new restrictions by closing lounges in the country's capital, stopping food and beverage service and offering to waive fees passengers pay to change flights.

Those cases were traced back to a hotel where the people had completed quarantine after travelling from overseas.

The country closed its borders and implemented a strict five-week lockdown in March and April past year, with occasional virus outbreaks since then being quickly contained.

Victoria's COVID-19 testing boss Jeroen Weimar said the Holiday Inn worker, her partner and housemate as well as the three-year-old child and woman in her 50s were among 38 people who attended the event.

Ardern said several scenarios are being investigated.

"The Australian Health Protection Principal Committee will consider further updates from New Zealand tomorrow and provide advice to the Chief Medical Officer regarding the management of travel arrangements between New Zealand and Australia", it said in a statement.

But the most likely scenario is human-to-human transmission, Ardern said.