SYDNEY (BLOOMBERG, REUTERS) - The cluster of Covid-19 infections that has thrust Sydney's Northern Beaches into lockdown has grown to 122 cases, health officials said on Sunday (Dec 27).

Seven new local cases were reported overnight, with six linked to the cluster, New South Wales state Premier Gladys Berejiklian told reporters.

The outbreak is a blow to Australia, which had largely suppressed community transmission through rigorous testing and contact tracing, and by shuttering the international border - with all returning overseas travellers made to isolate for 14 days in quarantine hotels.

The source of the cluster is still being investigated.

Some 250,000 people in the Northern Beaches have been told to remain at home except for essential medical care and provisions and not to allow visitors until at least Dec 30.

Sydney's five million residents have been barred from travelling to other states and territories across Australia due to the cluster, disrupting travel plans during the peak summer holiday season.

Australia's largest city is awaiting word on whether any public New Year's Eve celebrations will be allowed.

"I appreciate frustration levels are increasing as we get closer to New Year's Eve and days we stay at home increase," Ms Berejiklian told a news conference.

"We hope to have some clear information for everybody tomorrow, or the latest the day after, on what the New Year's Eve and the next weeks will look like."

Public countdowns to New Year's Day in big cities such as Sydney have in the past been an occasion for parties and gatherings at barbecues, urban parklands or on beaches in the Southern Hemisphere summer.

But the outbreak has thrown many plans into chaos as state authorities focus on measures to quell the resurgence.

Australia has fared better than most developed economies in the pandemic through swift border closures, lockdowns, widespread testing and social distancing. It has recorded just under 28,300 infections, the overwhelming majority in Victoria state, and 908 Covid-19 deaths.

Victoria, Australia's second-most populous state, neighbours New South Wales. Its capital Melbourne, the nation's previous hot spot, was in a harsh lockdown for months.

On Sunday, it recorded its 58th consecutive day with no coronavirus community transmissions and no related deaths.