"Yesterday afternoon we put an improved bid to Blackburn for Roque Santa Cruz but it was rejected," said Hughes.
Sam Allardyce also confirmed Rovers had rejected the latest bid for Santa Cruz - City's fourth. "Yes, they (Manchester City) have made another bid," he said.
"We have considered it and it's not been accepted. They have been unsuccessful.
"But whether they come back before Monday's 5pm deadline, I've no idea."
Hughes said City were considering whether to pursue the matter any further, although Allardyce has suggested they would be wasting their time as he would not be able to find a replacement.
That later changed earlier on Friday when Allardyce completed the signing of El-Hadji Diouf from Sunderland for around £2m.
After spending three years together at Bolton, Allardyce and Diouf are again reunited at Ewood Park.
Allardyce said: "He is a talented player. He can be a little wayward, as everybody knows, but hopefully I'll be able to control him as much as I did when I was at Bolton."
There will be no immediate return to the north-east for Diouf, though, as Blackburn failed to complete the transfer by the noon deadline ahead of Saturday's game at Middlesbrough.
Allardyce said: "In the time I spent with him we always finished in the top half of the Premier League, no lower than eighth, and we played in Europe.
"Hopefully he can bring his ability, his trickery to Ewood Park, and delight some of the Blackburn fans."
When reminded of Diouf's diving antics that won Allardyce the game that night four years ago, with a chuckle the Rovers manager said: "And nobody has ever done that for Blackburn in the past, have they not?
"If he goes and plays to his best then they (the fans) will soon take to him because he is talented.
"I just have to make sure he's ready and available, and he produces the best he can, because his best is very good - and normally it doesn't come this cheap."