Claudio Ranieri's side secured promotion into Ligue 1 in May and wasted no time in starting a summer splurge by splashing out 70 million euros combined for Porto pair Joao Moutinho and James Rodriguez.
The principality club is also leading the race for Atletico Madrid striker Radamel Falcao this summer, and Ancelotti - whose side is well-versed in spending heavily in the transfer market to achieve success - has embraced the latest opposition in the league.
"It is good for French football to have another competitive team [financially]," Ancelotti told Le 10 Sport. "If Monaco buy top players, then Ligue 1 will be more competitive and spectacular."
PSG spent well into the hundreds of millions fashioning its current squad during the last two summers, spending sprees that included acquiring Zlatan Ibrahimovic, Thiago Silva, Ezequiel Lavezzi, Javier Pastore and Marco Verratti.
Ancelotti guided Les Parisiens to league success for the first time in 19 years in May, but he has expressed his desire to part company with the club this summer, with Real Madrid reportedly seeing him as an ideal replacement for outgoing manager Jose Mourinho.