Japan's economy contracted less than expected in the last quarter, showing stronger signs of recovery from the deadly tsunami. The economy shrank by an annualised rate of 1.3 per cent in the three months to the end of June. Cabinet Office said, it shrank 0.3 per cent from the previous quarter. Most forecasters were expecting drops of about 2.6 per cent and 0.9 per cent. Yoshikiyo Shimamine of Dai-Ichi Life Research Institute said the scenario that Japan's economy will get on a recovery track later this year has not changed. He added that growth was given a lift by carmakers getting their production back on line.