Manchester City manager Pep Guardiola is reportedly considering whether to enter the transfer market for a new defender.
Despite currently failing to challenge Liverpool for the Premier League title, Guardiola has insisted that City will not move for a fresh face in January.
However, Football Insider claims that the Spaniard is contemplating an approach for Nunez, who has impressed at times this season.
While he has only featured in six La Liga matches, the 22-year-old has helped Bilbao keep clean sheets against Barcelona and Real Madrid.
Arsenal, Everton and Bayern Munich are also said to hold an interest for the player, who featured for Spain Under-21s at the European Championships in the summer.
Nunez still has three-and-a-half years remaining on his contract.