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Why ANZ and these dividend shares could help you smash low interest rates

According to the Australian Financial Review’s quarterly survey of economists, the median forecast reveals that economists still believe the next move for the cash rate is up.

However, economists don’t see this change being made by the Reserve Bank of Australia until June 2020.

While this is great news for borrowers, it is another blow for savers and income investors that will have to deal with paltry interest rates for some time to come.

The good news is that the Australian share market has plenty of quality income shares to choose from with generous yields.

Three that I think are worth considering are as follows:

Accent Group Ltd (ASX: AX1)

One top income share that I think is worth considering is Accent Group. The footwear retailer’s shares are currently changing hands at a little under 15x trailing earnings and provide a trailing fully franked 5.6% yield. I think this is good value considering management recently reported stronger than expected trading in the first half of FY 2019. As a result, it has provided interim EBITDA growth guidance of between 15% and 20%.

Australia and New Zealand Banking Group (ASX: ANZ)

Due to the Royal Commission and the cooling housing market, the banking sector was hit hard in 2018. I’m optimistic that things will be much better for the banks in 2019, especially if the Royal Commission final report doesn’t contain any surprises. In light of this, it could be a good time to consider snapping up ANZ Bank’s shares for its trailing fully franked 6.5% dividend.

BHP Group Ltd (ASX: BHP)

This global mining giant’s shares currently offer a trailing fully franked 4.6% dividend. In addition to this, BHP recently announced a US$1.02 (A$1.44) per share special dividend following the completion of its asset divestments. Investors have until January 10 to get on the share registry to be eligible for this special dividend which provides a yield of 4.2% based on its last close price.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Accent Group. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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