City were keen to sign the 23-year-old from Olympiacos in August but were outbid by Ukrainian club Shakhtar Donetsk, who he joined for £12.5million.
But Castillo, who starred for his country in this year´s Copa America, has failed to earn a regular place at his new club, starting mostly on the bench, and his agent Jose Luis Padilla told the Daily Mail: "There has been an agreement with Manchester City so that Nery can be with the club for one year on loan so he can prove himself and play active football."
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