But the Toon face a major stumbling block in their bid to sign the England midfielder.
Kalvin Phillips has recently been in Club World Cup action
Phillips, 28, is a long-term target for Eddie Howe's side.
Newcastle are eager to strengthen their midfield following Sandro Tonali's betting ban.
According to the Guardian, the Toon are the "front-runners" to sign Phillips next month.
They add, however, that Newcastle must structure the deal in a way that sees them stay within their financial fair play budget.
City would prefer to sell Phillips, who has no future at the Etihad under boss Pep Guardiola.
But they are willing to loan him out next month if the majority of his £130,000 a week salary is covered.
Other Premier League clubs could join Newcastle in the race to sign Phillips.
While Juventus have also held talks with Phillips' representatives ahead of a potential swoop.
It is not yet known whether the former Leeds star would fancy a move abroad.
But he has accepted that he must look for regular first team football in order to keep his England place for Euro 2024.
Phillips has played just 89 minutes across City's first 17 Premier League matches this season.
Three Lions boss Gareth Southgate said last month: "Between him, Pep and Txiki [Begiristain], I'm sure they'll discuss the best route forward.
"We know the quality of his play and he was our player of the year a couple of years ago.
"We'd like him to be in a better rhythm, but there aren't many players who can play in his position at the level."
Guardiola, 52, recently said of Phillips: "I don't know what's going to happen. I feel so sorry for my decision for him. I've said that many times.
"He doesn't deserve what has happened to him and I'm so sorry.
"The only thing I can say about him is I am asking for good personalities and characters and he is a perfect example. And after that I have to give him something and I didn't do that.
"It's just because I visualise some things and visualise the team and things - and I struggle to see him.
"I'm not very pleased [with myself] and I am so sorry for him. I will not say that [to him] because it is a business and I have to be a professional.
"But if one guy behaves [poorly], I don't care. But the way he behaves with the team-mates and everyone, I care. So that's why hopefully it can turn around.
"And I've said many times, if it comes to January and he stays, I'm more than pleased because he trains really good and he's a lovely guy and character."
SunSport revealed last week that City could look to replace Phillips with Fulham star Joao Palhinha.
The Portuguese ace missed out on a deadline day move to Bayern Munich in the summer, and could leave Craven Cottage next month.
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