Wednesday have been linked with Rhodes during the last two transfers windows, but Carvalhal insists that the clinical finisher is out of his price range.
Blackburn are said to be looking for £12 million for the Scotland international, as reported by HITC.
And Carvalhal said: “Everybody knows it’s a fantasy about this player.
“Do you think we have £10m-12 million to pay for a striker? It doesn’t make any sense. He’s a player who is completely out of our budget.
“We are doing everything with sense. We don’t have one of the biggest budgets of the Championship. There are teams who have invested more money than us. Everything we do is with good sense and economical.”
Rhodes has been one of the most prolific scorers in the Football League for the past few seasons, and his goalscoring credentials are undoubted in the Championship.
Blackburn have recently signed Danny Graham on loan from Sunderland, leading to suggestions that Rhodes could be on his way out at Ewood Park.
Middlesbrough are also credited with an interest in Rhodes by HITC, but it remains to be seen whether Aitor Karanka’s side will make an offer.
Rhodes has scored 10 times in 25 appearances in all competitions this season, and he has 82 goals in 151 Championship starts for Blackburn overall.