It's good news for the economy - but bad news for interest rates

A sharp fall in the last quarter has seen unemployment drop to four percent.

Kiwibank chief economist Jarrod Kerr says employers are screaming for staff and wages are on the rise - suggesting we're near full employment and need to open our borders.

He believes the Reserve Bank will raise the Official Cash Rate 25 basis points later this month, to half a percent.

NZ and ANZ are both predicting the OCR will go up three times before the end of the year, to one per cent.

ANZ's also forecasting two more increases in the first half of next year, to 1.5 per cent.