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The Welsh Government will enforce a lockdown from midnight, affecting the entire country.
First Minister Mark Drakeford made the announcement this afternoon after a new strain of Covid-19 was discovered.
It will be the third national lockdown for Wales following a UK-wide lockdown earlier this year, and then a 'circuit breaker' lockdown last month.
And while Welsh residents had been looking forward to several days of household mixing being permitted to enjoy Christmas celebrations, these rules have now also been changed.
Originally, families in Wales would have been permitted to mix from 23 to 28 December – but now the easing of restrictions has been limited to Christmas Day only.
Announcing the lockdown and change to festive rules on Saturday, Mr Drakeford said: "While we all want to avoid further disruption to businesses and plans for Christmas, our overriding duty is to protect lives here in Wales.
"We know that 2021 will be a different and a better year.
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"Our economy will recover. Christmas will come again."
Wales had already been planning a nation-wide lockdown that was due to come into effect on December 28.
However, the move has now been pulled forward by more than a week for lockdown to commence at midnight tonight.
All but essential shops will be forced to shut as part of the new lockdown – as will the hospitality sector.
Mr Drakeford's announcement came as Prime Minister Boris Johnson warned of a new strain of coronavirus that scientists have discovered is more infectious than earlier strains.
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However, Chief Medical Officer Chris Whitty has stated there is no evidence the new strain is any more deadly or resistant to the vaccine that started being rolled out in the UK this month.
He said on Saturday: "As announced on Monday, the UK has identified a new variant of Covid-19 through Public Health England's genomic surveillance.
"As a result of the rapid spread of the new variant, preliminary modelling data and rapidly rising incidence rates in the South East, the New and Emerging Respiratory Virus Threats Advisory Group (NERVTAG) now consider that the new strain can spread more quickly.
"We have alerted the World Health Organisation and are continuing to analyse the available data to improve our understanding.
"There is no current evidence to suggest the new strain causes a higher mortality rate or that it affects vaccines and treatments although urgent work is underway to confirm this.
"Given this latest development it is now more vital than ever that the public continue to take action in their area to reduce transmission."
The new strain has led the UK governemnt to announce a new 'Tier 4' in England which will see travel bans enforced, shops closed, and leisure facilities shut.
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