Bars and clubs can open today without the Easter weekend-style trading restrictions, but New Zealanders will have to wait until next week to find out whether they can gather in groups of more than 10 people.
The Government will consider raising the maximum number of gatherings under level 2 at next week's Cabinet discussion on Monday, with an announcement to be made shortly afterwards.
If a decision to increase the maximum size is made, the changes could happen within 48 hours.
But Prime Minister Jacinda Ardern has warned this number will only be relaxed if the country continues to record Covid-19 case numbers.
Bar-owners had to wait an extra week before they could reopen to customers without the Easter-style restrictions. Some bars have been open in the past week, but have had to serve meals with drinks.
Today, that restriction lifts, although they cannot have more than 100 people in total and individual groups of friends must be capped at 10.
Although restaurants and cinemas are also allowed to open their doors at alert level 2 and can have up to 100 people inside, religious gatherings remain capped at 10 people.
The restriction has angered some religious leaders who argue they're quite capable of arranging for social distancing and appropriate hygiene, as other venues are trusted to.
Ardern has previously argued that religious services and similar gatherings are unsafe because those attending are part of a community and more likely to mingle and hug.
"When it comes to church services the logic there is, when you've got people who gather together, who are familiar with one another, in large congregations ... that is a risky activity," she said.
As the country records no new Covid-19 cases for the third day in a row, the Government announced it also has the option to further relax physical distancing rules.
There are just 35 active cases in New Zealand, with one person in Auckland's Middlemore Hospital.
Ardern yesterday said this lessening of the rules could happen at alert level 2, as the Government receives more Covid-19 data.
While she was "cautiously optimistic" at the consistently low case numbers, Ardern urged Kiwis to remain vigilant.
"Remember Covid-19 is still in our community and we know from our clusters that one case can become 90 after a single night out or a single event.
"It would only take two-to-three instances of that for our caseload to escalate back to pre-lockdown numbers."
New Zealand will remain in level 2 until the director-general of health Dr Ashley Bloomfield advised it was time to move, she said.
Changes will be reviewed every two weeks, the Prime Minister said, although there is no set date on which the alert level will lower to 1.
Bloomfield encouraged Kiwis to download the NZ Covid Tracer, which helps to "build a picture" of where you've been, should you be infected with the virus.
The app has the function to scan QR codes at participating businesses allowing users to keep a digital diary of their movements, without needing to handover their personal details to businesses.
More than 92,000 people have already downloaded the app after it was made available on Tuesday evening.
It's hoped the app would eventually take the place of manual sign-ins at businesses.
Privacy had been a major consideration of the app and had been worked through with the Privacy Commissioner, as would any future iterations which have Bluetooth functionality, he said.
Contact tracing will be one of the strict protocols bars have to follow, as they reopen for the first time in nearly two months.
From today, bars and clubs can open, as Ardern says she has "huge faith" that they will stick to the "three S" rules - seated, separated, and single service.
Ardern acknowledged times have been tough for owners and bar staff and she wished them well.
But as hundreds of hospitality workers return to work, more than 2300 staff at Air New Zealand and Fletchers are set to lose their jobs.
More than 1300 cabin crew jobs have been axed in a move one worker called "crushing".
Fletcher Building is shedding around 10 per cent of its workforce - around 1000 staff - as part of "resetting the business for the future," chief executive Ross Taylor said.