The Covert Agent: Melbourne City keen to cancel Anthony Caceres loan deal

The playmaker is likely to be squeezed out in order to make room in the squad

Melbourne City want to cancel the loan deal of midfielder Anthony Caceres to free up squad space for the signing of current injury replacement Kearyn Baccus.

The Covert Agent can reveal the 26-year-old, who is on loan from Manchester City, is the easiest player to move on in order to snare Baccus on a permanent deal, according to sources at the club.

However the former Central Coast man would have to agree to a termination of his loan contract for City to get their wish.

Baccus has become a favourite of coach Warren Joyce since he joined the club as an injury replacement for Scottish attacker Michael O'Halloran.

With O'Halloran finally returning from a hamstring complaint last weekend, Baccus' deal at City would have expired but the club managed to switch him to a injury replacement for French winger Florin Berenguer.

If a severance of Caceres' deal cannot be arranged, City would be forced to look at off loading another player of similar wage, or loan out a few of their youngsters to free up salary space.

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The tense situation between Joyce and exiled striker Bruno Fornaroli appears unlikely to be resolved until January, with the Uruguayan set to depart the club during the transfer window.

City, fresh from a confidence boosting 2-0 win on the road against Adelaide United, face a huge test against rampaging Melbourne Victory in the Christmas derby on Saturday at AAMI Park.

Joyce's men clinched the last meeting between the two sides in round one, with Riley McGree scoring the winner in a 2-1 victory at Etihad Stadium.