Unai Emery says Arsenal are working on potential transfer deals but admits it is unlikely he will strengthen his squad in January.
The Gunners boss expressed concern about the club's chances of finishing in the Premier League's top four after their 22-game unbeaten run ended at struggling Southampton.
The Spaniard remains relatively happy with the progress of his team this term and thinks it will be difficult to recruit top-level players during next month's window.
Asked if he will have money available before the January 31 deadline, Emery replied: "It is not easy. But I don't believe I would in this transfer window because it's not a very big possibility with the players.
"The club is working only if some player can help us with a high level or better than within for us.
"It is not a good situation for transfers in January but we are going to look and the club is working. But also we are in a (good) way.
"Our progress is also with young players and we are giving them chances, and when we need to give them more chances to play and show us (their) progress we are going to do."
Arsenal's squad appears stretched ahead of Wednesday's Carabao Cup quarter-final against north London rivals Tottenham, particularly defensively.
Defender Sead Kolasinac was a late withdrawal at St Mary's due to tightness in a thigh muscle, while right-back Hector Bellerin limped off with a calf problem and, according to Emery, could miss "some weeks".
Defenders Sokratis Papastathopoulos and Shkodran Mustafi served one-match bans during Sunday's 3-2 loss on the south coast, with the latter doubtful to return for the Spurs cup tie because of a hamstring issue.
Centre-backs Rob Holding (knee) and Konstantinos Mavropanos (groin) are also on the sidelines.
All three of Saints' goals came from headers following the visitors' failure to deal with balls into the box.
Substitute Charlie Austin nodded the 85th-minute winner after Henrikh Mkhitaryan twice cancelled out goals from Danny Ings.
Emery, whose side have scored 37 times in the top flight and conceded 23, knows Arsenal must tighten up at the back.
"It's true we need to improve and concede less chances to the opposition," he said.
"We are scoring a lot but we are also conceding a lot, it's more than we want for our objective."
Southampton moved out of the relegation zone on goal difference after new manager Ralph Hasenhuttl won his first home game in charge.
The shock victory was Saints' first in 15 matches in all competitions, but the Austrian insists his team cannot rest on their laurels.
"We are not out of the situation at the moment, we are still in the zone where we are battling not to relegate," he said.
"But it's a really important first step. It was important that we get our first points now and three we didn't have for a long time."
