NSW Health recorded 7437 new cases of the coronavirus and 14 more deaths - half the previous day's tally - in the 24 hours until 4pm on Sunday.
There are 2099 people with COVID-19 in hospital, 222 fewer than the previous day, with 137 in intensive care.
Dominic Perrottet was non-committal when asked on Monday if COVID-19 restrictions such as mask wearing indoors and compulsory QR code check-ins would be extended beyond February 27.
But he says NSW is now "in a very strong position".
As coronavirus infections and hospitalisations track downwards, he noted there had been increased consumer activity over the weekend, with more customers in cafes and restaurants.
"I really do believe we are back on the front foot," he said.
"Activity is returning, cafes are busy, restaurants are pumping, even here in the CBD on the weekend Pitt Street Mall was bustling and that is a great thing for our state.
"I'd like to see people come back to the office as quickly as possible, we did that last year and we'll do it again."
He flagged a CBD Summit scheduled for Friday to explore the revitalisation of Sydney's city centre.
The summit will focus on how to drive business, employment and foot traffic in the city "in a COVID-safe way".
Health Minister Brad Hazzard says while there are a significant number of COVID-19 patients in hospital, there are fewer than forecast.
"The good news is that we're recommencing non-urgent elective surgery that was suspended on 10th of January," he said.
Private hospitals and public hospitals in regional and rural areas have begun a staged return to 75 per cent capacity.
Some 43.8 per cent of eligible people in the state have received a booster vaccination shot. Close to 90 per cent of people are eligible, having received their second dose more than three months ago.
Mr Hazzard stressed the importance of people getting a third jab, saying "there's a missing 50 per cent".
"You're far less likely to end up in the ICU, far less likely to die."
NSW Health said of the 14 people who died from the virus, one person was in their 40s, one was in their 50s, two in their 60s, five in their 70s, three in their 80s and two in their 90s.
Two of them had received three doses of a COVID-19 vaccine, seven had received two doses, one had received a single dose and four were unvaccinated.
About one million people have been advised to wait between a month and six weeks after catching the coronavirus to get the shot.
People aged 16 and 17 only became eligible for the booster on Friday.
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