The Blues legend feels the highly-rated coach will honour his contract at the Etihad Stadium and looking to complete “the project” in English football
UEFA’s sanctions for breaching Financial Fair Play regulations will be appealed by those at the Etihad Stadium.
For now, though, there is uncertainty when it comes to important figures on and off the pitch.
It has been suggested that Guardiola, who is yet to commit to a new contract, may be tempted to take on a new challenge over the summer.
The former Blues striker told Sky Sports: “I think he will stay. I think the project at City is not complete.
“Yes, the two-year ban will have an effect but I also think that, outside of City, where does Pep Guardiola go?
“He was obviously at Barcelona and went to Bayern Munich. You think in Italy and other places, I don’t think Italy is as attractive as the Premier League.
“Again, when you see the games the crowds aren’t bouncing and there aren’t the capacities that you get in the Premier League.
“You could say that France and PSG is a possibility but again, I think that here is where he wants to continue and finish his business.”
Guiding City to a first Champions League crown is considered to be the ultimate aim for Guardiola.
Being prevented from delivering on that front is likely to see him mull over his options when it comes to ambitious projects elsewhere.
The Blues are, however, still in contention for European glory this season.
The first leg of an eagerly-anticipated last-16 encounter with Real Madrid is fast approaching for City.
Premier League meetings with West Ham and Leicester will be taken in before Guardiola’s side head to Santiago Bernabeu on February 26.