Changes in Federal Reserve rates, and expectations thereof, lead to changes in newly-issued bonds almost immediately. It generally takes a few years for these to completely impact bond fund dividends, as funds must wait for their existing bond portfolio to mature to access new securities. Recent Federal Reserve hikes have yet to take full effect on most bond funds, as many of these still own older, lower-yielding bonds from before the Fed hiked rates. As these mature, they should be replaced with newer, higher-yielding securities, leading to higher income and dividends for most bond funds.