Iwobi has been impressive for Arsenal since he gained promotion to the Gunners’ senior team in the 2015/2016 season.
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While Wenger is impressed with the overall play of the 20-year-old, the Arsenal boss wants his player to improve in front of goal.
"You see, he is not a typical winger and I think he can play in that role. He turns the game forward, he passes the ball through the lines very well,” Wenger said.
"He has a final ball in him. He is now a little bit, I think he has it all in the locker to pass and give the final ball.
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"What you want from him now is the finishing, you know. That’s still a little part that is missing in his game. I think he is too nervous at the moment when he has the possibility to finish."
Iwobi is in line for another start as Arsenal make a trip to face Sunderland in the Premier League on Saturday, October 29.