Yes that is a mechanism to both control inflation but more importantly its function is to increase network security.  Without a max reward/stake many people would just keep all their CAPs in a single large block to make life simple (ie open wallet once every 15days and get one stake, recombine into one block, close wallet).  By having max/stake people have to have many blocks so they do not go past the max stake.  Having many blocks competing for stake gives better security by higher difficulty (better security) and additional inflation control by CAPs method of decreasing reward % as difficulty rises.  With higher difficulty and smaller blocks it takes longer to get a stake so you keep your wallet open longer which also helps with peers etc. 

A pretty well designed system that works pretty well.