For the first time in more than two decades, Indonesia slipped into a recession, government data released on Thursday confirmed as the Asian nation's economy continues to contract as it battles high coronavirus levels.

The country's statistics bureau released economic data on Thursday indicating that the largest economy in Southeast Asia had contracted by 3.49 percent year-on-year in the third quarter of 2020 after slipping 5.32 percent in the second quarter.

The Asian financial crisis of 1998 was the last time the country entered a recession, defined as two consecutive quarters of gross domestic product decline.

According to the Ministry of Health, Indonesia has been the worst country hit by the COVID-19 pandemic in Southeast Asia, with more than 420,000 infections and 14,200 deaths due to the virus.

Through lockdowns and border restrictions that have hurt the economy, the nation has been fighting escalating infections. However, according to a live tally of the virus by Johns Hopkins University, Indonesia has experienced a recent choppy and gradual decline in daily cases, from a high of 4,850 infections reported in early October to 3,356 cases on Thursday.

Forecasters predict that going forward, the economy will continue to experience hardships.

"As Indonesia struggles to get a hold of the coronavirus, we continue to expect growth momentum to be subdued for the next few quarters," financial services company ING Group wrote. "Meanwhile, after strict lockdown measures were reinstated in Jakarta last October after cases spiked, GDP in 4Q will likely be weighed down."