Following the release of weaker than expected economic data last week, the odds on a rate cut by the Reserve Bank next month have just increased materially.
According to the latest ASX 30 Day Interbank Cash Rate Futures, there is now an 82% expectation of an interest rate decrease to 0.75% at the next meeting.
Unfortunately, this means that the interest rates on savings accounts and term deposits could be about to come down to even lower levels in the near term.
But don't worry, because there are a large number of dividend shares on the local market that offer vastly superior yields. Three to consider buying are listed below:
Macquarie Group Ltd (ASX: MQG)
I think Macquarie's shares would be a good alternative to term deposits due the quality of its operations and its long track record of dividend increases. In addition to this, its shares currently offer a generous dividend yield that I think is especially attractive in this low interest rate environment. At present Macquarie's shares offer a trailing 4.4% partially franked dividend yield.
National Storage REIT (ASX: NSR)
Another good option for income investors could be this self-storage focused real estate investment trust. It has been growing its network at a solid rate over the last few years thanks to development projects and its growth through acquisition strategy. The good news is that management appears confident this growth can continue, which I feel bodes well for dividend increases in the future. At present the company's shares provide a 5.3% trailing distribution yield.
Transurban Group (ASX: TCL)
Another company which I believe is well-placed to continue growing its dividend in the future is Transurban. This is thanks to the quality of its toll roads, strong pricing power, and developments and acquisitions. in FY 2020 management intends to grow its distribution by 5.1% to 62 cents per security, which equates to a forward 4.2% forward yield.
