The Reds are now nine points clear at the summit - and 10 ahead of City ahead of their game Sunday at Southampton - after thrashing Arsenal 5-1 at Anfield on Saturday.
Jurgen Klopp's men are now unbeaten in their first 20 matches of the campaign, and have scored 48 goals and conceded just eight so far this term.
Though Guardiola has spent in the region of £539 million ($685m) on players since arriving at the Etihad Stadium, the ex-Barcelona boss says his City side are currently unable to compete with the Merseysiders.
“We did well so far,” said Guardiola prior to Liverpool going nine points clear. “We got 44 points in the first round.
"If you get the same number of points in the second round, that’s 88 points. With 88 points, you are champions. You have the numbers to be champions.
"Most of the Premier League champions in the past 20 years won it with less points. We did quite well. We did really well.
“But of course you have the past two games, against Crystal Palace and Leicester, and you have that sense, because there are two teams there now who are better than us in the last month.
“What can we say when Liverpool keep nine clean sheets and score a lot of goals? We cannot compete with that in terms of comparing with them.
“So we look at ourselves, and tomorrow against Southampton, we have to do what we do, and try to win, and when that happens, everything comes back to a normal position.”
Successive defeats to Crystal Palace and Leicester City have seen City surrender their grip on the title race, after their stunning 2017-18 campaign during which they accumulated 100 points and over a century of goals.
But City will have the chance to bridge the gap and change the momentum of the title race in the coming days when they face Saints before hosting Liverpool on January 3.