(Bloomberg) --

Australia continued its struggle to contain a delta outbreak across the nation’s east coast, with the race to increase vaccinations now key to prospects for a reduction in virus restrictions.

New South Wales state reported 262 new locally acquired cases on Sunday, state Premier Gladys Berejiklian told reporters, down from the record 319 a day earlier. That brings the number of local infections since the latest outbreak began in mid June to 5,169.

“Vaccination is the key,” Berejiklian said. She’s aiming to have 6 million people in the state inoculated by the end of the month, up from about 4.4 million ast present.

Victoria, whose state capital Melbourne is in its sixth lockdown, announced 11 new cases on Sunday, down from 29 on Saturday. State Premier Daniel Andrews urged Victorians to get vaccinated, saying that’s “critical to us being open and staying open.”

There were nine new cases in Queensland, where state Premier Annastacia Palaszczuk said a lockdown will ease in the southeast on Sunday. New stay-at-home orders were imposed for three days in the northern city of Cairns.

The highly contagious delta variant has caused shutdowns across Australia’s eastern coast, its most populated area. Delta is placing increased pressure on the nation’s so-called “Covid-zero” strategy, which has relied on closed international borders and rigorous testing to eliminate community transmission of the virus.

The central bank estimates household spending drops about 15% during lockdown and has acknowledged the economy will likely contract this quarter. Still, it expects a robust recovery to resume, and decided to stick with plans to taper bond purchases for now.

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