City made it 18 Premier League wins in a row with a 1-0 victory away to Newcastle United on Wednesday, a result that puts them 15 points clear at the top of the table.
Along with Barca, they are yet to lose a league match this season and breezed into the knockout phase of the Champions League in imperious fashion, with each side winning their group comfortably.
Guardiola, however, says Barca have the edge in Europe due to the Argentina star they possess in attack.
Asked if City could be considered top candidates to conquer Europe this term, he replied: "Who does Messi play for? They are the favourites."
Guardiola was speaking after his side totally dominated proceedings at St. James' Park but only managed to score one goal, courtesy of Raheem Sterling in the 31st minute.
Despite his frustration at not killing off the game sooner, he was thrilled with the way his players kept their focus to extend their record-breaking run in England's top flight.
"It's tough because it's the Premier League and everyone says it is the toughest [league]," he said.
"If you analyse the 90 minutes, we were much, much better. We created enough chances. If you analyse the last 10 minutes, they crossed once and could have scored one goal, so you could say completely different.
"To be focused after 17, 18 wins in a row is not easy but we did it.
"When we prepare games, we don't speak about records but about what we have to do to win games."
The only negative for City was the loss of Vincent Kompany, who went off injured after just 11 minutes of the match, and Guardiola says he does not know whether the club captain has picked up another serious problem.
"I don't know what's going to happen," he said of Kompany, who appeared to hurt his calf. "We're going to see how long it will take to recover."