Nah he's hanging around because City are basically his club, literally all of the infrastructure and those hired as staff and directors were all for him, years before he even went there.
City for Pep is pure comfort, they're not a genuine big club so there's no pressure, no one talks about City, the media don't focus on them at all, there's no scrutiny, it's all United and Liverpool(and to a lesser extent Arsenal).
At Barca and Bayern he was under an intense microscope from the media, proper fanbases(not that 'happy to be here' City vibe). Everything he said and did was analysed and questioned, it's not like that at City.
Add to the fact that his main managerial rival in Klopp is happy to hug and smile on the touchline and be an arse licker in pressers. He ain't got a Mourinho jabbing him every week, winding him up...again, no pressure.
He's living his best life right now, no reason for him to leave, CL or no CL.