An undersea earthquake of magnitude 7.0 struck in the South Pacific on Monday, sending small tsunami waves towards New Caledonia and Vanuatu.

The quake, initially reported as magnitude 7.3, struck 51 miles east of the Loyalty Islands and was the second major tremor in the same area in less than 24 hours and the third in the past month.

Monday's quake struck at 9.43 am local time (2243 Sunday GMT) at a shallow depth of six miles, east of the remote Loyalty Islands, the United States Geological Survey said.

The Pacific Tsunami Warning Centre said small tsunami waves were observed in New Caledonia and Vanuatu, but later said the danger had largely passed.

Waves may have reached up to one metre (three feet) above the high tide level in parts of New Caledonia and smaller in Vanuatu, the PTWC said.

"Minor sea level fluctuations...may continue over the next few hours," a statement from the agency said.