There have been 13 more COVID-19 deaths in Victoria and 182 new cases.
The figures released on Aug 22 take the national toll to 485 and the state death count to 398.
New infections on Friday dipped below 200 for the first time in more than five weeks.
Tough lockdown restrictions including a curfew remain in place across Melbourne until at least September 13.
Premier Daniel Andrews and Chief Health Officer Brett Sutton said recent infection numbers were encouraging.
While lockdowns were reducing general community transmission it was outbreaks in aged care and disability that remained a challenge, Sutton added.
“They might end up with a baseline level of transmission that is harder to shift,” he said.
There are more than 1700 active cases across 126 aged care sites. The 10 most infected facilities have between 107 and 209 cases each, according to government data.
More than 600 people remained in hospital on Friday.
The premier urged Victorians not to waver in their lockdown efforts, saying the state was not even halfway through an “ultra-marathon”.
The state’s inquiry into the hotel quarantine scheme on Friday heard from a security supervisor that he “had to keep an eye on” a couple of guards to ensure they didn’t leave their posts, fall asleep or spend too much time on their phones.
He had assumed they were fired, but later discovered they had been moved to a different hotel.
The supervisor, who was subcontracted by Wilson Security, said he was concerned by the amount of “subcontracting on top of subcontracting”.
By Andi Yu in Melbourne