Reserve Bank of Australia (RBA) insiders believe Labor's recent tax reforms, coupled with declining consumer sentiment, may inadvertently cool the housing market and reduce household spending, thereby easing inflationary pressures and potentially mitigating the need for further interest rate hikes. This effect, stemming from homeowners feeling less wealthy due to potentially falling property values, could lead to a decrease in spending on goods and services associated with property transactions. While former RBA board member Warwick McKibbin suggests this could be a helpful, albeit unintended, side-effect in the fight against inflation, he emphasizes that genuine inflation reduction requires productivity gains. The government maintains its focus on affordability for first-home buyers, while critics argue the policies risk damaging the economy.