The Premier League club sent scouts to watch the attacker in action at the Under-20 South American Championship that is held in Argentina.
Gonzalez has been in impressive form at the tournament finals, having scored 4 goals in 6 appearances for Paraguay Under-20 team.
Manchester City are keeping close tabs on the player who has yet to be handed a first team debut at Estadio da Luz and could make an official bid at the end of the season.
The only problem is that Benfica are not keen on selling one of their hottest prospects just a year after he joined the club.
Derlis Gonzalez, 18, joined Benfica in a €1 million deal from Paraguayan side Rubio Nu in the summer and has since been playing for club’s Under-19 side.
Prior to joining the Eagles, the youngster scored 8 goals in 50 appearances in Paraguayan top flight.