A general view shows rubble from collapsed buildings after an earthquake in Christchurch, New Zealand, in this Feb 22, 2011 image taken from video footage. A strong quake hit New Zealand's second-biggest city of Christchurch on Tuesday for the second time in five months, toppling buildings, causing "multiple fatalities", trapping people beneath rubble and sparking fires.[Photo/Agencies]

Rubble from a damaged building after an earthquake is seen in Christchurch February 22, 2011. [Photo/Agencies]

WELLINGTON - A strong earthquake killed at least 65 people in New Zealand's second-biggest city of Christchurch with more casualties expected as desperate rescuers picked through rubble to find people trapped in toppled buildings.

It was the second quake to hit the city in five months.

"We may well be witnessing New Zealand's darkest day...The death toll I have at the moment is 65 and that may rise," New Zealand Prime Minister John Key told local TV.

The 6.3 magnitude quake struck at lunchtime, when the streets and shops were thronged with people and the offices were still occupied.

Christchurch's mayor described the city of almost 400,000 people as a war zone.

"There will be deaths, there will be a lot of injuries, there will be a lot of heart break in this city," Mayor Bob Parker told Australian TV by phone.

The mayor said on Tuesday that as many as 200 people could still be trapped inside buildings wrecked by a strong earthquake.

Radio New Zealand quoted the mayor, Bob Parker, as saying the number trapped could be between 150 and 200.

Helicopters dumped giant buckets of water to try to douse a fire in one tall office building. A crane helped rescue workers trapped in another office block.

"I was in the square right outside the cathedral -- the whole front has fallen down and there were people running from there. There were people inside as well," said John Gurr, a camera technician who was in the city centre when the quake hit.

Authorities ordered major hospitals up and down the country to make room for quake victims. There were reports of a shortage of ambulances.

"A lady grabbed hold of me to stop falling over...We just got blown apart. Colombo Street, the main street, is just a mess...There's lots of water everywhere, pouring out of the ground," Gurr said.

Emergency crews picked through the rubble, including a multi-storey office building whose floors appeared to have pancaked on top of each other.

SILT, SAND AND GRAVEL

Christchurch is built on silt, sand and gravel, with a water table beneath. In an earthquake, the water rises, mixing with the sand and turning the ground into a swamp and swallowing up sections of road and entire cars.

TV footage showed sections of road that had collapsed into a milky, sand-coloured lake right beneath the surface. One witness described the footpaths as like "walking on sand".

Unlike last year's even stronger tremor, which struck early in the morning when streets were virtually empty, people were walking or driving along streets when the shallow tremor struck, sending awnings and the entire faces of buildings crashing down.

Police said debris had rained down on two buses, crushing them, but there was no word whether anyone had been killed or injured.

The quake hit at 12:51 pm (2351 GMT Monday) at a depth of only 4 km (2.5 miles), according to the U.S. Geological Survey.

"It's huge, it's just huge," a priest told a TV reporter outside the remains of the city's stone cathedral, part of which had been reduced to a pile of large sandstone blocks.

"I just don't know whether there are people under this rubble," he said, before he appeared to add in a quiet voice: "I think so."

TALK OF POST-QUAKE RATE CUT

The quake helped knock the New Zealand dollar down to $0.75 , about 1.8 percent off late U.S. levels, on fears the damage could dent confidence in the already fragile economy.

Westpac Bank also raised the possibility that the central bank could cut interest rates over the next few weeks to shore up confidence after the quake, while other banks pushed out their expectations for the next rate hike. ANZ now expects the central bank to be on hold until the first quarter of 2012.

Shares in Australian banks and insurers, which typically have large operations in New Zealand, fell after the quake. But credit rating agency Fitch said the tremor would not itself trigger a downgrade of New Zealand sovereign rating.

The tremor was centred about 10 km (six miles) southwest of Christchurch, which had suffered widespread damage during last September's 7.1 magnitude quake but no deaths.

James Goff, of the University of New South Wales' Natural Hazards Research Laboratory in Australia, said some buildings that survived last year's quake had been weakened and unable to withstand the second one, especially such a shallow tremor.

"A lot of the infrastructure has still not fully recovered from the last earthquake so that would have still been feeling weak and susceptible to another big earthquake," he said.

The region has been struck by thousands of aftershocks since the original quake.

New Zealand, which sits between the Pacific and Indo-Australian tectonic plates, records on average more than 14,000 earthquakes a year, of which about 20 would normally top magnitude 5.0.