In a statement, the bank said that restrictions on people's mobility and on production affected economic activity.
This marks Chile's worst economic performance since 1982, when the indicator plummeted 11 percent during one of the country's worst economic crises.
"The impact of the health crisis on economic activity was mainly seen in the second and third quarters, with contractions of 14.2 and 9.0 percent, respectively," the Central Bank said.
It also specified that service and construction activity were the most affected, with the former marking decreases in personal services, transportation, and restaurants and hotels.
In addition, the effects on expenditure were mainly reflected in lower household consumption and investment, according to the statement.
During 2020, the bank pointed out, the only sectors that grew were public administration, mining, financial services, and communication and information services.
The country has registered more than 900,000 COVID-19 cases and over 21,000 deaths.
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