Hong Kong's "zero-Covid" policy was on the ropes Saturday as authorities announced a record number of new infections, sending officials scrambling to ramp up testing capacity and warning that a tightening of virus-control measures could be needed.

Like mainland China and much of East Asia, Hong Kong has long followed a strategy of fighting the virus through contact tracing, targeted lockdowns and lengthy quarantines.

And as much of the world has chosen to open up and live with Covid-19, the city has dug in its heels, with Hong Kong leader Carrie Lam insisting she was still committed to achieving "zero-Covid" even as infections mount.

On Saturday the city recorded 351 confirmed cases, its highest daily figure since the pandemic began, with 161 cases being either untraceable or pending investigation.

"Based on the current growth rate of cases, we estimate that (medical isolation) facilities will soon be unable to quarantine all patients," health chief Sophia Chan told reporters.

Chan urged Hong Kongers to stay at home to slow the spread of the virus, though said that sewage analysis had revealed the virus had already been found in much of the city.

Health officials also said they would loosen rules that have seen thousands of close contacts of infected people detained in a government facility, suggesting they may be able to quarantine at home depending on their risk level.

This would free up hospital beds and take into account the fact that the Omicron variant -- which makes up the majority of Hong Kong's new cases -- causes milder symptoms, authorities added.

Last month authorities locked down thousands of residents of a public housing estate after a superspreader event, prompting criticism that the city's population density made home quarantine unfeasible.

Hong Kong's spike in cases came on the fifth day of the Lunar New Year holidays, during which the government warned against families gathering for festivities. 

City leader Lam earlier said authorities could further tighten virus-control measures next week.

Hong Kong has recorded more than 15,000 confirmed coronavirus cases with 213 deaths.