Liverpool are not willing to let Divock Origi leave the club on loan this summer.
According to Sky Sports, Liverpool will only allow Origi to leave if a permanent offer is on the table.
The report claims that Liverpool value Origi at £26m and are not looking to loan him out.
Watford, however, are only keen on signing the Belgium international on a temporary basis.
This means that the Premier League side are likely to miss out on a deal for the striker.
Origi has fallen out-of-favour under Jurgen Klopp, with Roberto Firmino and Daniel Sturridge both ahead of him in the pecking order.
The 23-year-old scored six goals whilst out on loan to Wolfsburg in the Bundesliga last season and is also capable of playing out wide.
Danny Ings also looks set to leave Anfield this summer, with Crystal Palace and Southampton reportedly looking to snap the former Burnley man up.
Southampton are thought to have had an offer rejected by Liverpool, who value Ings at £20m.
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