Following weak economic data last week and dovish comments out of the Reserve Bank this week, another cash rate cut is starting to look inevitable.
Whilst borrowers will be celebrating the news, savers and income seekers will be bitterly disappointed that they will soon have to contend with even lower rates.
Luckily, the Australian share market is here to the rescue with a plethora of dividend shares that smash these low rates.
Three to consider buying are listed below:
Australia and New Zealand Banking Group (ASX: ANZ)
Instead of putting your money in its term deposits or savings accounts, I would sooner buy this banking giant's shares. Especially with the housing market showing signs of improvement. This could give ANZ's earnings a major boost in the near term from increasing demand for mortgage loans. In addition to this, I believe its strong capital position not only supports its current dividend, but could even allow for buybacks. At present ANZ's shares offer a trailing fully franked 5.6% dividend yield.
National Storage REIT (ASX: NSR)
National Storage is one of the ANZ region's largest self-storage providers with a total network of 168 centres. Whilst this is certainly a large network, management intends to continue growing it through development projects and its growth through acquisition strategy. I expect this to support solid earnings and distribution growth over the next decade, which could make it a great alternative to term deposits. At present the company's shares provide a 5.3% trailing distribution yield.
Scentre Group (ASX: SCG)
Another alternative to term deposits could be Scentre Group. I think the owner of the Westfield properties in the ANZ region is well-placed to grow its distribution at a decent rate over the next decade thanks to the strong demand it continues to experience for its properties and the 535 million visitors (and growing) passing through its doors each year. At present its units offer a trailing 5.6% distribution yield.
