Schlupp, 20, linked up with the Barclays Premier League leaders last week but City boss Nigel Pearson refused to be drawn on whether his time with Sir Alex Ferguson's side would lead to a transfer.
He said: "Jeff is enjoying himself there and he is there until the end of this week.
"I have spoken to him two or three times and things are going well. It is good experience for him. Whether it becomes more is something for the clubs to discuss."
The move is the latest in a burgeoning relationship between the npower Championship club and United, which has seen Ritchie De Laet and Danny Drinkwater sign for City after leaving Old Trafford and Michael Keane and Jesse Lingard arrive on loan from the 12-time Premier League champions.
Schlupp, who came through the youth ranks at Leicester, has made five starts this season but the majority of them have been at left-back as cover for Paul Konchesky.
The Germany-born Ghana international is highly-rated as a striker by the midlands club and made an impact at Brentford during a loan spell in 2011, scoring six times in 10 appearances.