Millions of people in China's financial hub were confined to their homes on Monday as the eastern half of Shanghai went into lockdown to curb the nation's biggest Covid outbreak.

Authorities announced late on Sunday that it would carry out a two-phased lockdown of the city of around 25 million people to carry out mass testing.

The government had sought to avoid the kind of hard lockdowns regularly deployed in other Chinese cities, opting instead for rolling localised lockdowns, in an effort to protect Shanghai's economy.

But Shanghai has in recent weeks become China's Covid hotspot, and on Monday another record high was reported with 3,500 new confirmed cases.

The area locked down on Monday was the sprawling eastern district known as Pudong, which includes the main international airport and glittering financial district.

The lockdown will last until Friday, then switch to the more heavily populated western Puxi section that includes the historic Bund riverfront.

The government said the steps were being taken "to curb the spread of the epidemic, ensure the safety and health of the people" and root out infections "as soon as possible".

The government has not yet specified any new impact on air travel or the city's bustling port.

The eastern half of Shanghai went into lockdown on Monday so the government could carry out mass Covid testing The eastern half of Shanghai went into lockdown on Monday so the government could carry out mass Covid testing Photo: AFP / Hector RETAMAL

China had largely kept the virus under control for the past two years through strict zero-tolerance measures that included the mass lockdowns of entire cities and provinces for even small numbers of cases.

But Omicron has proven harder to stamp out.

China has reported several thousand new daily cases for the past two weeks.

Those numbers remain insignificant globally, but are up sharply from less than 100 a day in February.

Tens of millions of residents in affected areas across China have been subjected to citywide lockdowns that appear to have had some success slowing Omicron.

Shanghai officials, however, have repeatedly stressed the importance of keeping the eastern economic engine running.

The unpredictable rolling neighbourhood lockdowns over the past few weeks have caused anxious residents to pick store shelves clean and swamp online grocery platforms out of fears they were next to be shut in.

Shanghai residents complained on Monday morning that insufficient notice was given for the lockdown and expressed fears about acquiring essentials.