Economists are placing different bets on whether labour market figures due out on Wednesday will show official unemployment rising or falling.

However, all are forecasting unemployment will continue to hover close to last year's low of 3.2 per cent.

The figures will come in the wake of a significant drop in inflation and could help determine whether the Reserve Bank raises interest rates again next month, or calls it quits with the official cash rate at 5.25 per cent.

Stats NZ reported in April that prices rose 1.2 per cent in the March quarter, which was a far smaller increase than the 1.8 per cent rise the Reserve Bank had pencilled in, taking the annual inflation rate down to 6.7 per cent.

ANZ is forecasting that official unemployment will have dipped to 3.3 per cent in the March quarter, down from 3.4 per cent in the three months to the end of December, describing that as a possible 'last hurrah” for the jobs market.

Data on filled jobs and an elevated number of job advertisements pointed to 'solid employment growth”, it says.

ANZ is forecasting rising interest rates will eventually do their job of cooling the economy but says while signs of slowing domestic demand had undoubtedly emerged in recent months, 'we aren't expecting to see these manifest as yet to any great degree in the labour market, which remains very tight”.

It is also forecasting that the annual increase in average hourly earnings in the private sector, another indicator that will be watched by the Reserve Bank, will tick up to 8.3 per cent, from 8.1 per cent in the December quarter.

However, ASB is predicting unemployment will move up a notch to 3.5 per cent, tipping an earlier cooling in tight labour market conditions.

It expected Wednesday's figures would confirm employment remained 'above its maximum sustainable level”, but with increasing spare capacity emerging.

The demand for labour would cool over the remainder of the year as the economy slowed, it says.

Kiwibank is tipping the unemployment rate will remain unchanged at 3.4 per cent despite the 'deteriorating economic outlook”.

Westpac, which came closest to forecasting the extent of the drop in inflation in April, also forecast unemployment would hold steady.

Senior economist Michael Gordon says firms remained in hiring mode.

- Tom Pullar-Strecker/Stuff.