Arsenal have turned down an approach by Inter Milan to sign Shkodran Mustafi on loan, according to Sky in Italy.
It is understood that the Serie A side are likely to go back in with a bid for a permanent transfer, but it is believed the Gunners want to get back most of the money they paid for him last year.
The 25-year-old moved to the Premier League in August 2016 with Arsenal paying Valencia a fee that could eventually rise to £35m for his services.
The German made 26 appearances for Arsenal in the Premier League last season, scoring twice.
He was on the bench for Arsenal's opening game of the season - a dramatic 4-3 win over Leicester City - as he is still regaining full fitness after being given an extended break following his participation in the Confederations Cup with Germany.