New Zealand is back in covid-19 lockdown with its largest city, Auckland, back at alert level 3 for three days from noon Wednesday.

The rest of NZ will go back to level 2 social distancing after four new cases of covid-19 were discovered outside managed isolation and quarantine facilities.

In a hastily called press conference on Tuesday night, Prime Minister Jacinda Ardern and Director-General of Health Ashley Bloomfield said four new cases of the coronavirus were found in a South Auckland family that weren’t linked with the border.

Ardern, who’d been told of the cases at 4pm, said the country will take a precautionary approach, imposing level 3 restrictions in Auckland, and level 2 in the rest of the country to get a better handle on whether NZ faces a second wave of the virus.

The restrictions kick in from midday Wednesday Aug. 12 and run to midnight Friday Aug. 15. Auckland restaurants and bars emptied suddenly after the mid-evening announcement, the central city experienced immediate traffic jams and Uber was in surge pricing on a normally quiet Tuesday night. Countdown supermarkets announced they were closing as shoppers rushed to stock up.

“These are very significant decisions, moving an entire city, and New Zealand’s largest city into level 3 restrictions is not a decision we take lightly,” Ardern said.

“This move means we can be cautious, but also make sure that we have more information before we make any decision that have a longer-term impact.”

Three days is the period normally associated with the time required between covid tests.

More stimulus?

Ardern said longer term decisions will need to consider what further financial support may be needed.

The government set up a $60 billion fund to deal with the covid response and recovery, and put aside $14 billion of that as a back-up if there was a flare-up.

NZ went 102 days without cases in the community, and has been operating freely since the country went to alert level 1 - life as normal behind strictly controlled borders.

Campaigning for the NZ general election on Sept 19 has been suspended.

National Party leader Judith Collins said the news would "come as a shock to all New Zealanders who believed what we had been told - that we had got on top of this virus."

Bloomfield said three days is sufficient time to do extensive testing and get a better grip on the situation. He said it was inevitable that NZ would get another case of community because “this is a tricky virus.”

Testing is being ramped up in Auckland and all staff at managed isolation and quarantine facilities will be tested for the virus.

Ministers with powers to act including Ardern, Deputy Prime Minister Winston Peters, Grant Robertson, Chris Hipkins, Andrew Little and David Parker convened a meeting to discuss tonight’s decision.

Immediately after that, Ardern told Opposition leader Judith Collins and Auckland mayor Phil Goff about what the government’s course of action is.

Be kind

Goff asked Aucklanders to show some patience.

“I understand that people are probably feeling a little bit scared, a little angry and a little confused right now,” he said in a statement.

“None of us wanted to go back into a lockdown, but we always knew this was a very real possibility.”

Ardern stressed that essential services will be open in Auckland as they were last time, and urged people not to panic buy as they did in the run-up to the previous lockdown.

Currency traders largely ignored the impact of a three-day closure of NZ’s biggest city, with the kiwi sailing through a short-lived dip to recently trade at 66.08 US cents.

Investors and traders are awaiting the Reserve Bank’s monetary policy statement tomorrow, which will be based on forecasts and decisions made before tonight’s lockdown decision.

While no one expects governor Adrian Orr and the committee to shift the 0.25 percent official cash rate, some economists anticipate the central bank will signal a larger quantitative easing programme.