This afternoon the Reserve Bank will hold its August meeting and make a decision on the cash rate.
Although there is a small chance of a rate cut to zero, it looks reasonably unlikely based on the latest cash rate futures.
While this is a small win for income investors, it doesn't make much of a difference in the grand scheme of things. Whether or not there is a cut today, interest rates will still be at ultra-low levels.
In light of this, I would suggest income investors continue to look beyond savings accounts and term deposits. Instead, I think they should be focusing on some of the quality dividend shares trading on the Australian share market.
Two ASX dividend shares that I would buy are listed below.
Dicker Data Ltd (ASX: DDR)
The first ASX dividend share to consider buying is Dicker Data. It is a leading wholesale distributor of computer hardware and software across the ANZ region. Dicker Data has been a very positive performer over the last few years and this has continued in FY 2020. It recently reported stellar growth during its recently completed first half. Dicker Data reported half year revenue above $1 billion for the first time and a 30.4% lift in net profit before tax to $42 million. In light of this, the company is on course to increase its dividend by 31% to 35.5 cents per share this year. Based on the current Dicker Data share price, this represents a generous fully franked 4.75% dividend yield.
Rural Funds Group (ASX: RFF)
Another ASX dividend share to consider buying is Rural Funds. I think the agriculture-focused property group is a great option for income investors due to the quality and diversity of its portfolio. Another positive is the long tenancy agreements of its assets, which I believe puts Rural Funds in a position to continue growing its distribution during the pandemic and for many years to come. The company recently reaffirmed its distribution guidance of 10.85 cents per share in FY 2020 and then 11.28 cents per share in FY 2021. Based on the latest Rural Funds share price, the latter equates to a 5.5% yield.
