Murphy said: "You have to give Everton a lot of credit for what they've done so far this season. They have played some great stuff and deserve to be where they are in the league," said Murphy.
"I think this is actually a great time for us to be playing a derby given the run we've had in the league. It's exactly the kind of game we need.
"We have to be up for it and we will be. I'd be lying if I said it didn't hurt us even more because we're behind Everton in the league. Of course it does, not just because we really need to get some points on the board, but because a lot of us are local lads and Liverpool supporters.
"It hurts us as fans to be behind Everton and if we can win and go back above them it will make it sweeter. We won't need any extra motivation going into this one. We know we can't afford to lose even more ground in the Premier-ship. The fact we are so close together in the league is going to add to the occasion.
"I've heard a few whispers from people that we're actually the underdogs going into the this game. I don't think I'd go that far.
"We know from experience there are no favourites in a derby anyway and previous form doesn't usually matter. It could be a cracking game because both teams have play-ers who can be matchwinners."