Real Madrid legend Zinedine Zidane has admitted that the reigning European champions are monitoring Liverpool star Raheem Sterling.

The young English winger has been linked with a move away from the Anfield club in recent weeks and has himself revealed that he rejected the latest offer from the club.

The Merseyside club are desperate to tie the winger down to a new deal, but are having a tough time dealing with Sterling's representatives, who reportedly want the club to improve their offer exponentially.

The former Queens Park Rangers youth team player has been Liverpool's best player thus far this campaign, and despite having two years left in his current deal is reportedly the subject of interest from various clubs around Europe including Premier League rivals Arsenal and Chelsea.

The former French international, who currently manages Real's Castilla B team, admitted that the club are monitoring the Liverpool forward along with a host of other talented young players across Europe, like they did with Gareth Bale and Rafael Varane in the past.

"We know who Raheem Sterling is, and of course we are monitoring him as a player," Zidane said, as quoted by the Guardian.

"There are very few players in the world who can improve the Real Madrid squad, so it is going to make sense we monitor the progress of the best young players in the world. We monitored [Gareth] Bale for over a year, the same with Isco and also [Raphaël] Varane."

"We monitor many of the best young players in Europe, then if we feel they have something to offer Real Madrid we will contact their club and try and make the next step," the former Juventus midfielder added.

However, Brendan Rodgers has dismissed reports linking Sterling with a move away from the club and has made it clear that he is going nowhere this summer.