Japan's annual wholesale inflation hit 4.0% in February, data showed on Wednesday, underscoring pressure from rising raw material costs that will keep alive market expectations of a near-term interest rate hike by the central bank.

Investors in Japan are speculating on the recent rise of 10-year government bond yields to their highest levels since 2008. Higher yields are said to signal market optimism traditionally, but Japan’s current economic situation on the ground has everyday residents worried about a massive downturn.