The Serie A club's chief has continued to refuse to rule out a deal for the Italian forward, and revealed that negotiations over a potential transfer will continue on Monday
The former Inter forward has fallen out of favour under Roberto Mancini at the Etihad Stadium and has only one league goal to his name this season.
On Saturday, Galliani said he was "99.9 per cent" certain that the Rossoneri would not be able to sign Balotelli but in a press conference on Sunday he suggested further progress has been made.
"Yesterday was 99.9% no, today is 99.5% no," he told reporters. "It is a situation different from that of yesterday, but the bag is closed until tomorrow morning."
Goal.com revealed last week that City had lowered their asking price to £20 million, but the Premier League champions want the fee paid up front.
Milan, on the other hand, are believed to have offered around £25 million across six years for the 22-year-old, who led the line for his country at Euro 2012.
Galliani was speaking after Milan had moved up to fifth place in Serie A by beating Atalanta 1-0 in Bergamo.