Arsenal have made Douglas Luiz their No1 transfer target in January but face stiff competition from Manchester City.

Pep Guardiola’s side have fallen short of expectations so far this term and may look to the market to strengthen their title bid.

The Gunners returned to the top of the Premier League at the weekend and have a long-standing interest in Aston Villa midfielder Luiz, 25.

According to inside sources, Mikel Arteta is willing to meet the £100million valuation set by the Midlands club but accepts a deal in the middle of the campaign is unlikely.

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The report also suggests Villa will knock back any attempt to poach their Brazilian star next month as they look to mount their own title challenge.

City are expected to part company with Kalvin Phillips next month, with the former Leeds man failing to impress in Manchester.

Thomas Partey’s future at Arsenal appears uncertain and the Ghanaian powerhouse, who is sidelined by injury, has made just four top-flight appearances this term.

Under Unai Emery this season, Luiz has bagged five goals and two assists in the league and is regarded as an elite asset at Villa Park.