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MELBOURNE (Reuters) - Australian police said on Tuesday they have arrested a 20-year-old man suspected of planning a New Year's Eve attack in Melbourne.

The police operation is continuing but no further arrests are expected, Victoria police said in a statement. He is due to appear in court.

"It will be alleged the man arrested was involved in undertaking preparations for planning a terrorist act in Melbourne on New Year's Eve this year," the police said.

They said the threat to Australia's second most populous city "has been contained" and that the arrest was not linked to any previous police investigations.

Australia, a staunch U.S. ally that has sent troops to Afghanistan and Iraq, has been on heightened alert since 2014 for attacks by home-grown militants returning from fighting in the Middle East or their supporters.

(Reporting by Sonali Paul; Editing by Alison Williams)

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Reuters