(Bloomberg) -- Chile’s government cut its forecast for gross domestic product growth this year to 0%, one day after a key economic indicator showed increasing odds of a recession. 

The government trimmed its estimate from 0.2% though it kept its forecast for 2.5% growth next year, according to its Public Finances Report published on Tuesday. Public debt will rise to 41.2% of GDP in 2024 from 38.1% in 2023. 

Chile has been rattled this year by high interest rates, weak confidence and greater uncertainty in top trading partners like China. On Monday, Chile’s central bank released August’s Imacec, a GDP proxy, which showed that activity unexpectedly fell. Finance Minister Mario Marcel has said the economy is getting on stronger footing following a series of shocks.

Read more: Chile’s Economy Nears Recession After Surprise Activity Drop 

Policymakers cut rates by a total of 175 basis points in its last two meetings to 9.5%, as inflation slows toward target. 

Previously, the central bank revised its 2023 GDP forecast to between -0.5% and 0% from a prior range of -0.50% and 0.25%. The economy will expand between 1.25% and 2.25% next year, it said. 

Analysts surveyed by Bloomberg see Chile’s economy contracting by 0.2% this year, the worst performance in South America after Argentina.

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