The Blues were strongly linked with the Uruguayan striker during the January transfer window and the rumours refuse to go away.
The Spaniards are unwilling to part with one of their most prized assets, though, especially as uncertainty also surrounds the future of Forlan's strike partner Sergio Aguero.
City have made it clear that they are prepared to spend big in the pursuit of their top targets, with a record-breaking move for Brazilian star Robinho completed last summer.
However, their attempts to lure further big names to Eastlands have proved fruitless, with AC Milan ace Kaka rejecting their £100million overtures in January.
Cerezo believes City's lack of success in the transfer market will persuade Forlan that remaining at Vicente Calderon is in his best interests.
"I don't think Forlan is keen to go to Manchester City after seeing how Robinho is getting on there," Cerezo said in Marca.
"They are rumours and more importantly no-one has come to us to speak about the matter."
Forlan spent two years with City's arch rivals Manchester United between 2002-04, but struggled to get to grips with life in England.
Having flourished since leaving Old Trafford, it is unlikely that he would actively pursue a move to back to the Premier League.