The champions sit one point behind pacesetters Liverpool at the top of the table and the Sky Sports pundit thinks that it will be difficult for the Reds and Arsenal to stop Pep Guardiola's side winning a fifth straight crown.
Carragher told Sky Sports News: "I still think Manchester City, without a doubt, have an edge on Liverpool. And probably just Arsenal, maybe.
"You change your mind every week, don't you on the back of results, but I still think City are the team to beat - and Liverpool and Arsenal, you can flip a coin."
Despite viewing City as favourites, Carragher thinks that the team are vulnerable to counter-attacks in the absence of key midfielder Rodri - who is set to be out for a lengthy period with a knee injury.
The pundit said: "I think they do look a little bit more vulnerable to the counter-attack. That's always the way to hurt Manchester City, because they have so much possession.
"The only way you can really score or hurt them is set-pieces and on the counter-attack.
"I think missing Rodri will hurt them. I think it'll hurt them more in the Champions League, when you're playing higher-class opposition when you get into the quarter-finals and semi-finals. That's when they may feel it a little bit more.
"I still think they can win the league without Rodri, even though he's one of the top players in the Premier League."
Liverpool have started superbly under new manager Arne Slot to top the table and Carragher expects his former club to be active in the January transfer window should they still be in a strong position come the turn of the year.
He said: "They're very much pushing [to win the Premier League title], as they were last season. We shouldn't forget that.
"They haven't reinforced. It'll be really interesting to see if Liverpool do bring anyone in in January. They didn't bring too much in in the summer.
"And if they think they've got a realistic chance at the title and there's a player that they feel fits their criteria, their model, I think they'll pay the money to bring that player in."
