According to the latest weekly economic report out of Westpac Banking Corp (ASX: WBC), the banking giant's economics team continues to forecast two more rate cuts by the Reserve Bank in the near term.
Westpac expects the cash rate to be down as low as 0.5% by March of next year. After which, it has forecast for it to remain at this level all the way out until at least December 2021.
If this proves accurate, it means that savers and income investors will have to contend with ultra-low rates for a long time to come.
But don't worry because these dividend shares can help you beat low rates:
BHP Group Ltd (ASX: BHP)
If you're comfortable with buying resources shares then I think this mining giant would be a very good option. This is due to its world class operations and the high levels of free cash flow they are generating thanks to favourable commodity prices. A note out of Goldman Sachs last week rated its shares as a buy and forecast a FY 2020 dividend yield of 6%.
Coles Group Ltd (ASX: COL)
This supermarket giant is one of my favourite dividend shares due to its defensive qualities, generous dividend policy, and positive long-term outlook. I believe Coles is well-placed to grow its earnings and dividend at a solid rate over the next decade thanks to rational competition returning to the industry and its focus on reducing costs materially through the use of automation. I estimate that its shares currently provide a forward fully franked 3.5% dividend yield.
Stockland Corporation Ltd (ASX: SGP)
I think this diversified Australian property company could be a great option for income investors. Stockland owns a diverse portfolio of property assets which include shopping centres, retirement villages, industrial parks and housing estates. It reported a 4% increase in funds from operations (FFO) in FY 2019. I estimate that it will increase its full year distribution modestly to 27.8 cents per unit this year, which works out to be a forward 6.25% distribution yield.
