The Sun says Inter president Massimo Moratti will fly to Sardinia today for a meeting with ex-Liverpool boss Benitez at his holiday hotel.
He said: "I can only say good things about him.
"Benitez will be the new Inter manager. Over the next few days it will be decided. Benitez has beaten Jose five times - a sign he is well prepared.
"He works hard and in the important matches he makes no mistakes. It's important we continue to do well in Europe. Doing well in the Champions League brings us satisfaction."
Benitez's No 2 Mauricio Pellegrini is also expected to join Inter, while outgoing Italy boss Marcello Lippi has been linked with Liverpool.