
The Gunners had been linked with an audacious £136m move for the winger as Mikel Arteta looks to strengthen his title-winning squad.
However, reports in Spain now suggest the player would prefer to negotiate a new contract at the Bernabeu and continue in La Liga.
The news comes amid Arsenal's continued interest in Newcastle captain Bruno Guimaraes.
United insist there has been no contact between the two clubs and they want to keep him at St James' Park. He is due to report back for pre-season training on July 31, when his future could become clearer.
Reports on Sunday suggested Arsenal will initiate diaglogue this coming week, but as things stand, Newcastle are yet to receive any offer.
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Bradley Barcola will not sign a new contract with Paris Saint-Germain, according to reports in France, opening up the chance of a move to Liverpool.
The France international has two years on his current deal yet, but PSG could cash in on the 23-year-old.
Liverpool are the favourites to sign Barcola, who starred for France in the World Cup, and has helped PSG win the last two Champions League titles. Andoni Iraola is keen to improve his frontline options, with Mo Salah leaving Anfield at the end of last season.
However, they may have to fork out in the region of £140m for his services.
Spurs boss Roberto de Zerbi will look to offload some players in the coming weeks after making several big signings, including Sandro Tonali from Newcastle.
Romero would join Argentina team-mate Lautaro Martinez at San Siro if a move materialises, who is Inter's captain.
Juventus manager Luciano Spalletti says Aston Villa keeper Emi Martinez wants to leave the club this summer, and join the Turin giants.
Speaking to La Gazzetta dello Sport, he saidL "Martinez? He is a goalkeeper who wants to change teams, and we are looking for competitiveness, but at the moment, we have two goalkeepers."
Newcastle United are aiming to rebuild a squad capable of firing them back to the Champions League this summer, with a huge transfer window ahead of us. With players likely to leave and a host of names linked with a move to St James' Park, it's going to be a fascinating few months.
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