Liverpool were interested in Kelly before he joined Bournemouth from Bristol City for £13million last summer.
And despite making just eight appearances for the Cherries this season due to injury, the Reds were thought to be keen to make a bid for the 21-year-old in the current transfer window.
But The Athletic claim there’s ‘no chance’ of Liverpool moving for England U21 international.
Michael Edwards, Liverpool’s sporting director, ‘was angered by how the player’s agency conducted itself last summer’.
The report claims Jurgen Klopp is also interested in Norwich full-back Jamal Lewis, but the clubs are still some way apart in terms of their valuations for the player.
The relegated side want at least £20million for the defender, while Edwards has put forward a bid of £10million, with £8million up front and a further £2million in add-ons.