NSW has reported 29 new COVID-19 deaths, its deadliest day of the pandemic so far, and 63,018 cases, while the number of hospitalisations and those in ICU has also risen.
Meanwhile, 56 people have died from the disease across NSW, Queensland, South Australia and Victoria.
It comes as a youth detention centre in Alice Springs has been plunged into lockdown after four inmates tested positive for COVID-19.
In NSW, there are 2,525 COVID-19 patients in hospital and 184 in ICU, compared with 2,383 and 182 on Thursday.
NSW Health cautioned some of those cases were the same positive cases reported numerous times from multiple rapid antigen tests (RATs) and PCR tests.
The changes to testing guidelines comes as health authorities hope the Omicron variant wave is peaking in NSW.
"Whilst the health system is under pressure and our health teams are doing an amazing job, we are currently tracking at both an ICU and hospitalisation rate here in NSW better than the best-case scenario, " Mr Perrottet said.
NSW Premier Dominic Perrottet. Source: AAP
"That is encouraging, reassuring and pleasing."
But NSW Health's deputy secretary Susan Pearce warned this doesn't mean the hard work is over.
While the modelling reveals COVID-19 patients are staying in hospital for a shorter period of time, admissions and discharges are keeping hospitals constantly busy.
"The consequence of that for our health system is that every day I'm seeing a lot of movement in and a lot of movement out of hospitals and that in and of itself generates a significant amount of work for our staff," she said.
Mr Perrottet has also confirmed schools will open for all students as scheduled on 1 February, despite rising COVID-19 case numbers.
While authorities still don't have an accurate picture of the growth of infections across the state, Chief Medical Officer Professor Paul Kelly on Thursday said he expected daily case numbers will begin to fall soon.
"NSW is a bit ahead of the other states and that's not surprising, they started earlier, but they are close to peaking if not already," he said.
Chief Medical Officer Professor Paul Kelly. Source: AAP
"The other states are a little bit further behind that but I think end of January, early February is probably where we will see a change."
Cases in Victoria grow
Victoria has recorded 34,836 new COVID-19 cases and 18 deaths, as questions linger about rapid test supply to allow more workers to be freed from isolation.
The new infections include 15,440 from RATs and 19,396 from PCR tests, the health department confirmed on Friday.
There are a record 976 patients in hospital, up 23 from Thursday, including 112 in intensive care of which 30 require ventilators.
It comes after Premier Daniel Andrews announced that the list of workers exempt from isolating as close contacts will be broadened from midnight on Tuesday, to include those in emergency services, education, critical utilities, custodial facilities, transport and freight.
Health care, food distribution, manufacturing, packaging and retail supermarket workers are already exempt, while state government project workers will not be included in the list.
Queensland records three deaths
Meanwhile, three people have died from COVID-19 in Queensland as the state records another 23,630 new virus cases.
It comes a day before the state dumps all domestic border control and a day after it suffered its deadliest day of the pandemic.
"Any death is a tragedy and to experience it during a pandemic is heartbreaking," Premier Annastacia Palaszczuk said on Friday.
Two of those who died were in their seventies and one in their sixties, while all three were not vaccinated.
Outbreak hits Northern Territory youth detention centre
The pandemic has reached a Northern Territory youth detention centre with four inmates at an Alice Springs prison diagnosed with COVID-19.
Territory Families, Housing and Communities has provided few details about the infected youths, who tested positive earlier in the week.
It says the four, who are either being held on remand or sentenced to custody, are not symptomatic and are medically isolated to avoid spreading the virus to other prisoners.
The positive cases have led to the correctional centre suspending the intake of detainees.
"In line with COVID management plans, young people are being transferred to Don Dale Youth Detention Centre (near Darwin)," a spokeswoman said.
Three youths were moved to the controversial Don Dale facility on Thursday.
The Don Dale Detention Centre in Darwin. Source: AAP
"There are currently no plans to relocate any further young people currently at (the Alice Springs facility) out of the centre, as they are being appropriately cared for," the spokeswoman said.
The Alice Springs Youth Detention Centre is located within the Alice Springs Correctional Precinct, 25km from the central Australian city.
The centre houses both male and female detainees from Alice Springs and the surrounding regions.
On Thursday there were 15 inmates at the facility.
In the NT, 546 new COVID-19 infections were recorded on Friday, while Chief Minister Michael Gunner admitted the territory's new exposure site messaging system linked to the check-in app had not been operating as planned.
"Over the past week these messages have not been sent," he said. "There is no excuse for this."
Mr Gunner said instructions had been given to a government team to set up the new system by the NT's security and management committee.
"But it was not implemented, which is unacceptable," he said.
South Australia reports six deaths
Premier Steven Marshall said the state recorded six deaths and 5,679 new cases, the case numbers including Rapid Antigen Test figures for the first time.
He said the case figures had to be treated with caution, adding: "Many of the samples reported today are samples from two days ago."
Tasmania's active cases drop
Tasmania has reported 1,201 new coronavirus cases, but the overall number of documented active cases in the state has dropped for the second day in a row.
Twenty-four people with COVID-19 are in hospital, with 10 of those being treated specifically for virus symptoms. None are in intensive care.
The other 14 people in hospital have unrelated medical conditions.
The new infections have come from 852 self-reported RATs and 349 PCR tests.
Tasmania's health department says 1,739 people have been released from isolation in the past 24 hours.
It means there are 7439 reported active cases, down from 7,969 on Thursday and 8764 on Wednesday.
Thirty-nine cases are staying in community management facilities and 293 people are utilising COVID-at-home care.
Additional reporting by SBS News.
