According to the latest cash rate futures, the market is becoming increasingly confident that another rate cut is coming.
The latest futures contracts are pointing to a 64% probability of a cut to zero in October and a 36% probability of rates remaining on hold at 0.25%.
Whatever does happen next month, I feel it is safe to say that rates will be staying at very low levels for some time to come.
In light of this, I think ASX dividend shares will remain the best option for income investors for the foreseeable future.
But which ASX dividend shares should you buy? Here are two which I think could be great options for investors right now:
Coles Group Ltd (ASX: COL)
The first ASX dividend share I would buy is this supermarket giant. I like Coles due to its yield, defensive qualities, and positive long term growth outlook. The latter is underpinned by its strong market position, expansion opportunities, and focus on automation. Based on this and the current Coles share price, I estimate that its shares currently offer investors a fully franked ~3.2% FY 2021 dividend yield. I think this is very attractive in the current environment.
Wesfarmers Ltd (ASX: WES)
Another option to consider buying is Coles' former parent, Wesfarmers. I think the conglomerate would be a great option right now due to its strong performance during the coronavirus pandemic and its positive long term outlook. The latter is thanks to its portfolio of solid businesses and particularly the Bunnings business. Bunnings has been performing exceptionally well during the crisis. This is a big positive given its importance to Wesfarmers' overall earnings. In addition to this, I suspect that management may look to accelerate its growth with acquisitions in the near term. Based on the current Wesfarmers share price, I estimate that it offers a fully franked 3.5% FY 2021 dividend yield.
