McManaman has been an integral figure in the City side since his debut against Aston Villa.
"Steve has got to play for us when he is fit, it is just a question of where he can do the most damage," said City boss, Kevin Keegan.
"At the moment it is central midfield, but you could play him left or right or just off the front man and know he will do a job for you.
"He took a lot of responsibility on Sunday which people who last saw him at Liverpool might not have expected.
"At that time he looked a bit of a free spirit, but now you can tell him exactly what job you want doing and know he is experienced enough to do it.
"He will probably miss the Wolves game next weekend, but I will be delighted to have him back after the international break."