The 21 year-old was handed his first start for the Premier League club in their final Europa League group stage match at Sion on 10 December.

That appearance came after the full-back was brought on as a second-half substitute and set-up a goal as Liverpool ran riot 6-1 against Southampton in the League Cup quarter-finals at the start of the month.

However, with Smith establishing himself as a back-up for Alberto Moreno, the Anfield club are reluctant to let him leave for the Australian U-23 side, who are set to play in the Olympic qualifying tournament in Qatar next month.

"It's a bit of a double edged sword, we've carried Brad with the Olyroos all season and now he's broken into the first team frame they won't release him for the qualifiers which is disappointing from our perspective," Postecoglou told Fox Sports.

"Aurelio Vidmar [Olyroos coach] has selected him all the way along even though he wasn't training so that's the disappointing part about it."

Postecoglou handed Smith his international debut last year and the national team coach has been pleased to see the Sydney-born left-back get another chance with Liverpool after re-signing in October.

"It's great to see him getting an opportunity now and I know he's rated pretty highly within Liverpool speaking to the people there," he said.

"I'm glad we locked him in with the national team because I've always felt that he’s one that could play at the highest level."