Norway will allow larger groups of people to meet from next week and let most bars and restaurants serve alcohol up to midnight as it takes its next major step in unwinding COVID-19 curbs, Prime Minister Erna Solberg said on Friday.

The capital Oslo and its surrounding region will also relax some of its stricter localised restrictions, allowing gyms, cinemas, theatres and restaurants to reopen and children to resume indoor sports, authorities added.

"We're ending the social lockdown of Oslo that has lasted since early November," city council chief Raymond Johansen told a news conference.

"This will allow many people to get back to work," he said.

Norway has had some of Europe's lowest rates of infections and deaths since the start of the pandemic. But it tightened measures after a rapid increase in hospitalisations in March triggered by more contagious variants of the coronavirus.

Since then, rates of new infections have declined steadily, raising hopes that a third wave of infections has been brought under control.