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Arteta, who was linked with replacing Arsene Wenger at the Emirates in 2018 before Emery was appointed, joined the City coaching staff in July 2016 after retiring as a player.
He has also been mentioned in regard to another of his former clubs, Everton, with their manager Marco Silva's future under scrutiny.
"I said many times with my players, staff, they're free to do what they want to do," Guardiola said.
"With Mikel it's about being a friend. I want the best for him. What I want is we stay together this season and next season, but I don't know what's the best for him."
