(Reuters) – A rapid pace of monetary policy adjustment to curb rampant inflation may lead to a flattening U.S. Treasuries yield curve, according to Larry Fink (NYSE:), chief asset manager at BlackRock Inc.

Fink stated that the yield curve would flatten, and that even if Federal Reserve is extremely aggressive, I could see a, or a negative yield. Fink spoke to CNBC on Tuesday in an interview. The transcript is available.

The yield curve shows investor expectations regarding U.S. growth. The U.S. Federal Reserve’s hawkish approach to rate hikes has led to higher short-term rates and flattening of the curve.

An inverted or negatively sloped curve is an indicator of a future recession and is bad news for the economy.

Fink stated that the key issue that will determine the economy’s fate is the shape of the yield curve.

BlackRock’s chief executive, who oversees $10 trillion in assets as of December 31, stated that inflation will rise and that the Federal Reserve would be more aggressive over the next two-years.

The financial markets expect that the U.S. Federal Reserve will raise interest rates up to four times in the coming year. This is after the post-pandemic stimulus that not only boosted the U.S. economy, but also increased inflation.

Two-year U.S. Treasury yields (which track short-term interest rates expectations) rose to above 1% on Tuesday. This further weakens the yield advantage of longer-dated securities over those with shorter dates.

The yield curve for two-year and 10-year notes was flattened earlier to 81 basis point, which is the lowest yield gap since Jan.