Is that not like saying if I bought a property for 100 k with a rent of 10k per annum, the yield is 10%, yet in time if the value of the property increases in value to 150k, I'm only yielding sub 7%Bond returns are not the same thing as Bond yields.
Your fathers bond fund is doing well because bond prices have risen, the yield moves inversely with the price.
If a bond paying €2 interest per annum was bought for €90 that is a yield of 2.2%
If your father owned that bond and the price increased to €95, then your father has done well, he has made a 5.55% return (approx it is a bit more complicated that that, the bonds maturity has shortened).
However the yield has fallen to 2.1%
In any normal world a bond with a negative yield would not exist, yet at present some bonds do in fact have negative yields.
The room for bond prices generally to rise further without moving into negative yield territory is small.
The income is still the same regardless, the yield to the original purchase price is what matters from an investment POV, is it not?