UPDATE 2-Indonesia to extend monetary stimulus as president seeks more help

* says stimulus measures among biggest in emerging markets

* Expects economy to grow between 4.8% to 5.8% in 2021

* President urges to shoulder bigger role in reforms

* Economists see room for more rate cuts (Adds comments by economists)

JAKARTA, Dec 3 (Reuters) - Bank Indonesia’s governor pledged on Thursday to extend monetary stimulus into 2021 to support Southeast Asia’s largest economy, as the country’s president urged the central bank to take on a bigger role in government-led reforms to create jobs.

“Bank Indonesia (BI) will continue to direct all policy instruments to support national economic recovery,” Governor Perry Warjiyo told an annual meeting with government officials and top bankers, held virtually due to COVID-19 curbs.

“Monetary stimulus will continue in 2021,” he said, adding that BI’s benchmark rate would remain low until “inflationary pressure signs begin to appear”.

So far this year, BI has cut rates a total of 125 basis points to a record low, carried out 682 trillion rupiah ($48.37 billion) in quantitative easing, more than half in the form of direct government bond purchases, and relaxed lending rules in response to the economic impact of the pandemic.

Warjiyo said those measures amounted to one the biggest stimulus programmes across emerging markets, while noting that bond purchases would hurt BI’s balance sheet from 2021 onwards.

BI expects economic growth to rebound to within a range of 4.8% to 5.8% in 2021, compared with a contraction of 1% to 2% this year, he said. The 2020 forecast would be Indonesia’s worst economic performance since the 1998 Asian financial crisis.

Speaking at the same meeting, President Joko Widodo urged BI to take on “a more significant role in the fundamental reforms that we are currently executing”, including a greater contribution to support the real sector and encourage job creation.

While he did not elaborate, his administration and some lawmakers last month filed a draft bill on the financial sector which included a proposal to add economic growth and employment to BI’s mandate, on top of price stability.

Bahana Securities economist Satria Sambijantoro said “BI certainly can – and should – loosen policy a little bit more”, noting Indonesia still had relatively high nominal interest rates and domestic funding costs.

But OCBC economist Wellian Wiranto said BI has room for only one more 25 basis point cut, “given the need to conserve interest rate differential as an anchor for fund inflows.” ($1 = 14,100.0000 rupiah) (Additional reporting by Tabita Diela and Maikel Jefriando Editing by Ed Davies and Raju Gopalakrishnan)