After impressing at Stoke, Deulofeu took his game to the next level on his first start at Vicarage Road.
"He's a very good player," Gracia said.
"I don't know in the future what will happen [with him]. I want to focus on him playing well for Watford."
Gracia believes Deulofeu can make Spain's World Cup squad if he maintains his current form.
"Maybe in the summer, he can get in the national team. Who knows," he added.