Guidetti has just returned to full fitness following a long-injury lay off which came after he sparkled in a loan deal at Dutch giants Feyenoord last term, scoring 20 league goals in just 23 games.
City had considered using him for this season, but a rare virus saw him sidelined through pre-season, and he has only just returned to action.
Despite his lack of fitness City were considering letting him leave in January and Swansea were keen, along with Newcastle and Sunderland.
However, Sky Sports understands that, should Guidetti have left then the player would have headed to either Spain or Russia with Malaga, Sevilla and Rubin Kazan all ready take him.
"The club rate John very highly, but were considering the loan and deals with some big clubs were on the table, however the chance is now there for him to prove himself with City," a source told Sky Sports.
Now Mario Balotelli's shock departure to AC Milan has thrust Guidetti towards the first team - and he looks set to be given the role of fourth choice striker which will surely see him make his Premier League debut in the second half of the season.
"John is in training with us every day but is not ready to play at this moment," said City boss Roberto Mancini.
"He needs one or two months but, when he gets the chance to play, we will get him."