WATCH: Jewish Australians Support Overwhelming Show of Solidarity With Muslim Community After Sydney Siege

Haaretz's Dan Goldberg says the Australian authorities and media are reluctant to call this a terror attack due to a 'deep undercurrent of Islamophobia' in the country.

Following Monday's deadly siege at a Sydney café that left two hostages and the gunman dead, there was a "surreal and subdued" atmosphere in the country on Tuesday, said Haaretz's correspondent in Australia, Dan Goldberg.

Australians were not used to such a "random attack," he said, adding that it was "slowly dawning on people that this could be the beginning of a new era."

Goldberg, speaking from Sydney in a Skype interview with Aimee Amiga, described the Jewish community as being in complete solidarity with the rest of Australia, "shocked and deeply saddened by this traumatic event." There was a "heightened sense of concern" among Jews following this and previous attacks on Australian Jews, he added.

The Australian authorities have refused to label the siege a terror attack for fear of reprisals. Although noting the country's pride in its multiculturalism, Goldberg added, "The government is playing a very, very sensitive game with the Islamic community, because there is a deep undercurrent of Islamophobia in this country."

Jewish schools and institutions went into lockdown on Monday, a situation the majority of the Jewish population would have expected, said Goldberg.

"I don't think it was an overreaction," he added. "Some Jews used to call Australia, not America, the golden medina (country), but that dream may slowly be disappearing."

Watch the full interview here: