Barcelona midfielder Ivan Rakitic is reportedly in talks with the club over a new contract despite speculation linking him with a January move to Manchester City.

City manager Pep Guardiola was thought to be considering a move for the Croatia international this month having lost Ilkay Gundogan to a long-term injury, and the uncertainty over his future grew when Rakitic was left out of the Barcelona squad for Sunday's La Liga match against Villarreal.

However, the Daily Mail reports that Rakitic is still happy at Barcelona and has entered discussions about extending his stay at Camp Nou.

The 28-year-old's current contract with the club does not expire until 2019, but the Spanish champions are reportedly keen to fend off any interest by offering him a new deal.

Rakitic joined Barca in 2014 and has since made 129 appearances for the club, although he has been limited to 10 league starts so far this term.