City sit top of the table, two points clear of Liverpool after the Reds dropped two points at the Emirates with a 1-1 draw against Arsenal.
Liverpool have shown signs they can challenge defending champions City, while Chelsea and Arsenal too have surprised many fans with their excellent form.
But Carragher insists City are the better side, and Liverpool must pray Pep Guardiolas men become distracted by their quest to win the Champions League.
It will have been disappointing for Liverpool to concede that goal [to Arsenal], said Carragher on Sky Sports.
But I think Liverpool supporters, myself included obviously, need to just relax a little bit.
Youd think Liverpool had lost the league after the game at the weekend because its Ah its two points dropped. Man City are going two points clear. Theres a long way to go.
Man City are better than Liverpool, everyone knows that. But that doesnt mean Liverpool cant win the league.
I think Liverpools hope of winning the league will come in the second half of the season if City go far in the Champions League.
Their focus will be on that and then they might take their eye off the ball in the league. Thats the only chance Liverpool have got because City are better than them.
While City ran away with the league title last season, Liverpool concentrated their efforts on reaching the Champions League final.
Guardiola is expected to improve on reaching the quarter-finals in Europe this season, with Liverpool the side to knock City out of the competition last campaign.