Gunners remain favourites for exciting youngster.
Arsenal are expected to fight off competition from both Manchester United and Chelsea in their bid to sign Sporting Lisbon starlet William Carvalho this January, according to the Daily Express.
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Arsenal transfer news
The Gunners are in need of reinforcements in the defensive midfield department, and are working on a deal to bring in the talented young Portuguese international to bolster their ranks this season.
United and Chelsea have also shown a strong interest in Carvalho in the past, but it is thought that Arsenal will now win the race for the 22-year-old this month.
Arsene Wenger has been without the likes of Mikel Arteta and Jack Wilshere in midfield for much of the season due to injuries, and Carvalho could be an ideal addition.
Mathieu Flamini has been off form, while youngster Francis Coquelin was recalled from a loan with Charlton Athletic on an emergency basis to fill in in that position.
Arsenal will now hope that they can bring Carvalho to the Emirates Stadium before the transfer deadline.