The 23-year-old has reportedly drawn long-term interest from the likes of Juventus but looks set to stay put.
'It is insane that people ask me these questions all the time, ' he told the London Evening Standard.
'I am very happy in London. I am very happy at this club.
New Arsenal head coach Unai Emery has revealed that though signing another player is not optimally important for him, he will be open to discuss any possibility if such a situation arises.
Speaking about the way Emery's PSG side played, the Bulgarian added: "They always controlled the game and the ball was moving on the pitch not in the air and I think what he's going to do with Arsenal".
The Gunners have snapped up as many as five players already this summer, with Lucas Torreira, Bernd Leno, Sokratis, Matteo Guendouzi and Stephan Lichtsteiner all coming in to strengthen the squad ahead of a challenging new season.
This will be Arsenal's second match in the International Champions Cup.
"This week, Mesut, Elneny and Iwobi are starting to work with us and our first impression is very good with them", Emery said. "My information is he (Iwobi) is going to sign and continue with us".
That follows a 1-1 draw against Atletico Madrid on Thursday in the same pre-season friendly tournament, where youngster Alex Smith Rowe impressed as Arsenal lost 3-1 on penalties to the Europa League holders.