Japan is set to declare a state of emergency for Tokyo through August 22 to contain a new wave of coronavirus infections, a key minister said, as the organisers consider banning all spectators from the Olympics starting in about two weeks.

Japan's economy minister Yasutoshi Nishimura, who heads the government's coronavirus response, said a state of emergency in Tokyo is set to begin on July 12, after new daily infections rose to 920 on Wednesday, the highest level since mid-May.

Medical advisers to the government have said for weeks that having no spectators at the Games would be the least risky option amid widespread public concern that the influx of thousands of athletes and officials will fuel a fresh wave of infections, according to Reuters.

Organisers have already banned overseas spectators and have for now set a cap on domestic viewers at 50 per cent of capacity, up to 10,000 people. Talks to finalise the restrictions on the spectators are expected either on Thursday or on Friday.