Erling Haaland’s penalty ensured City took three points from Crystal Palace on Saturday with a 1-0 win, but Arsenal remain five points clear at the top of the table after they won at Fulham on Sunday.
Arsenal still have to play at the Etihad Stadium in the Premier League, however the City boss says the five-point advantage means that the Gunners remain the favourites for the title.
But after back-to-back Premier League crowns, Guardiola again praised his players for maintaining their challenge, particularly after the super start from Arsenal in the first half of the season.
“Still Arsenal are the favourites because they are in front,” Guardiola said.
“They made an incredible first leg, they dropped a little bit but now they’re coming back.
“They have had many years not winning the Premier League and it gives you a little extra to win games in 93, 98 minutes.
“That is something they have that we don’t have because we won back-to-back two times. That’s why when people say about your opinion on the team and the season it’s after two times back-to-back and 50 points for our opponents in the first half still we are there.
“Normally in this country when you win something a lot and you don’t start well or someone is a bit better, you drop it. You are not consistent. Still we are there. This is the best trophy and compliment that we can have.
“I don’t know what’s going to happen at the end of the season but still they know that we want to be there and we will fight to be there and this is great.”