Besides being a poor policy move that panders to the most drastic parts of Australia's labor party, the way the news was delivered is insulting: Approved on a Jewish holiday, the Australian government thought the quiet removal of Jerusalem's status from its website would go unnoticed — a chaotic and unprofessional lack of courtesy.
Australia is firmly committed to a two-state solution, and recognizing Jerusalem as the capital of Israel directly undermines this. Australia's former PM Morrison's 2018 decision was nothing more than a manipulative attempt to win favor, and the new Labor leadership has rightly reversed this.
There's a 50% chance that Israel will recognize Palestine by November 2065, according to the Metaculus Prediction Community.