Gazzetta dello Sport claim the Italian giants are unwilling to meet City's asking price and will look elsewhere for striking reinforcements.
Liverpool have been linked with a £15million bid for the Montenegro international but interest might cool after Christian Benteke edges closer to his switch from Aston Villa.
Jovetic is almost certain to leave the Etihad this summer but might have to look past Inter in his quest from first-team football.
The 25-year-old is thought to be keen on a return to Italy after moving to England from Fiorentina jn 2013.
City paid £22m to secure his services after the highly sought-after forward emerged as a target for Europe's top clubs.
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Stevan Jovetic appears to be searching for a new club
But he has made just 28 Premier League appearances in two seasons, scoring eight goals.
Wilfiried Bony's arrival from Swansea in January hastened his exit from the club, with Jovetic being left out of the Champions League squad the final nail in the coffin.
However, Inter could see Genoa attacking midfielder Diego Perotti as a cheaper alternative to the wantaway City man.
Perotti recently turned down a move to newly promoted Watford.
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