While the Reserve Bank has been tipped to lift rates sooner than previously expected, it is still expected to be some time before rates reach 2% and above again.
In light of this, dividend shares could be one of the best ways to earn a passive income for a while yet.
But which dividend shares should you buy? Two that are rated as buys and tipped to pay big dividends are listed below:
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BHP Group Ltd (ASX: BHP)
The first ASX dividend share to look at is BHP. This mining giant could be a top option for income investors thanks to the diversity of its world class operations and the strong free cash flow they generate. The latter bodes well for dividend payments in the coming years.
Morgans is positive on the company. And while the broker acknowledges that its shares have rebounded strongly in recent months, it still sees enough value in them to maintain its positive view.
The broker commented: "BHP's investment appeal has ebbed lower as its share price has rebounded off its October lows (when we upgraded our rating to Add), but despite this shrinking discount our confidence in the continuing upcycle for commodities has maintained our positive view on BHP."
Morgans has an add rating and $48.60 price target on its shares. As for dividends, it is forecasting fully franked dividends of $3.34 per share in FY 2022 and $2.62 in FY 2023. Based on the current BHP share price of $45.03, this will mean yields of 7.4% and 5.8%, respectively.
Harvey Norman Holdings Limited (ASX: HVN)
This retail giant could be another ASX dividend share to buy. This is due to its strong market position domestically and growing international operations.
Goldman Sachs is a fan of the retailer. It currently has a buy rating and $6.00 price target on its shares.
When the broker upgraded its shares late last year, it said: "We upgrade HVN to Buy based on our renewed confidence in its short- to medium-term outlook on an ex-COVID basis. Additionally, HVN also trades favorably on an ex-property valuation basis and offers strong dividend yields and low balance sheet risks."
Goldman is forecasting fully franked dividends per share of 36 cents per share for the next three financial years. Based on the current Harvey Norman share price of $4.75, this will mean yields of 7.6% for investors.
