The Manchester club's current Brazilian midfielder will turn 33 in May so manager Pep Guardiola is reportedly already searching the market for a potential successor, with the Shakhtar Donetsk midfielder the most likely target.
Fernandinho has featured in 34 games in all competitions already for Guardiola, a figure he may not be able to maintain in the next few years.
It is because of this that the 'Sky Blues' are already evaluating their options, especially since they have allegedly ended their interest in Arsenal's Alexis Sanchez.
24-year-old Fred is thought to be a player that is of serious interest to the Premier League leaders, whilst City would also reportedly consider loaning the 24-year-old back to Shakhtar for the remainder of the season if this helped to secure a deal.
Fred has made 90 appearances for the Ukrainian team since joining in 2013 from Internacional, scoring nine times.