There has been speculation in the British media in recent days claiming that the England international is considering his options after falling out of favour under interim boss Guus Hiddink at Stamford Bridge.
Cahill is reported to be concerned about his recent lack of first-team football as this summer’s European championships in France draw ever nearer.
Liverpool’s defence has come in for plenty of criticism this season and Murphy feels that Cahill would instantly improve the Reds’ rearguard.
Speaking to talkSPORT, Murphy said: “Gary Cahill is competing with John Stones and Chris Smalling for a place in the England line-up, for me.
“And there’s one thing for sure, that if he stays on the bench for the rest of the season at Chelsea he’s not going to oust either of them from the team.
“The question mark is would Chelsea let him go? And if they would, who needs him and who could pay the money for him? He only recently signed a new Chelsea contract and he’s on a good wage.
“Would he suit Liverpool? Would he be a player that gets into the Liverpool team and make a difference? Yes, he would.
“He’s a terrific lad, a good pro, a good trainer and not a moaner or a whinger.
“I completely understand why he might want to move, if that is true. At his age it could be his last big championships in an England shirt, and I like that attitude that he’s desperate to play for his country.
“Can he perform to the levels we know he can in a different shirt, for a different club? Yeah, of course he can.
“He’s a winner and every time I see him play I think he’d die for the team, he gives it everything he’s got. If he does become available, there a few clubs would pay good money for him.”
Liverpool are gearing up for their Premier League clash with Leicester City at the King Power Stadium on Tuesday night.
Jurgen Klopp’s men head into that game in seventh place in the Premier League table on the back of their thrilling 5-4 win over Norwich City last weekend.
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