Media reports suggested that a fee of £2.8million had been agreed between Blues and Spanish club Deportivo La Coruna and that the Uruguayan striker was close to completing a permanent move to Blues.
"Am I confident? No, " Bruce has said.
"Things have moved a little bit but there is still a fair way to go.
"No fee has been agreed."
The 29-year-old striker, who spent the final four months of last season on loan at St Andrew's, has repeatedly expressed his desire for a move to Blues despite interest from both Real Zaragoza and Mallorca