'We like Rafa. We think Rafa's terrific,' American co-owner Tom Hicks told the Associated Press this week. 'We have put all our differences behind us.'

Following a string of lacklustre results early in the season, Benitez questioned in October whether Hicks and George Gillett Jr understood the transfer market.

Hicks said Benitez should concentrate on working with what he had.

'We did have a disagreement and we did ask him to focus on the important games, instead of worrying about spending more money for more players,' Hicks said from his Dallas office.

'We wanted to see what we could do with the players we had already bought.'

According to Hicks, the tensions were stoked by the media.

'Benitez went to a press meet and kind of pouted, and answered the same question 20 times, 'I'm focusing on my team',' Hicks said. 'And then the media made up everything from that point.

'They made up that we were going to fire him. They made up that I told him to shut up. They made up this battle between Benitez and the Americans.

'It is all behind us now.'

Benitez is facing a defensive conundrum before today's crucial Premier League match away to Manchester City as Sami Hyypia struggles to recover from the ankle injury suffered in the Boxing Day 2-1 win over Derby County.

He will have to choose between rushing Daniel Agger back from a three-month layoff or throwing Jack Hobbs, 19, into the fray only three weeks after Reading exposed Liverpool's frailties by beating them 3-1.

Had Steven Gerrard not scored a last-minute winning goal at Pride Park on Wednesday, Liverpool's slim title prospects would have dwindled even farther.

As it is, they are in fourth place, nine points adrift of leaders Manchester United, as they face a City side who are fifth.

City boss Sven-Goran Eriksson is set to recall midfielders Elano and Dietmar Hamann, after they were left out of Boxing Day's 2-2 draw with Blackburn.

He will turn to Elano to inspire the win and former Liverpool star Hamann to subdue his old teammate Steven Gerrard.

AP

Manchester City v Liverpool

Live, Ch27 and HD Ch303, 11.55pm