* IFC's Thunell warns of asset bubbles forming
* Authorities have to ensure money goes to productive use
* Says battling climate change business opportunity
FRANKFURT, Nov 19 (Reuters) - There is a danger of asset bubbles forming due to central banks' generous liquidity measures and low interest rates, the International Finance Corporation's chief executive told Reuters on Thursday.
"Cheap funding is fuelling some asset bubbles in equity markets, real estate markets," Lars Thunell, head of the World Bank's private sector lender told Reuters in an interview.
"You see gold prices shooting through the roof."
Asked what should be done to avoid this, he said it was a difficult balancing act, but that authorities should ensure added funds went to more productive use.
"Low interest rates and liquidity are floating around and not going to real bank lending to SMEs (small and medium-sized enterprises ... money should go to productive use.
But he said the stimulus packages had averted a more severe recession, even though it was uncertain how far they would carry the economy.
Governments had to be careful with public finances, he cautioned.
He told Reuters television in a separate interview the economic recovery was still fragile and the United States could not be expected to be the sole force in recovery, but emerging markets played an important role. (Reporting by Sakari Suoninen, editing by Mike Peacock and Victoria Main)