The Catalan has failed to secure a single trophy at City this season, having won 21 titles across his career before joining the Manchester club last summer.
This will be City’s first season since the 2014/15 without a major trophy, but Guardiola has insisted that this isn’t the priority for him.
"The team has played the way I wanted. We didn't play good enough, there were teams that did better," Guardiola told ESPN Brasil.
"In Europe, we still don't have the level to compete. City had gone 35 years without playing in Europe [Champions League]. The club crossed the round of 16 just once. So, we need time to have conditions to compete.
"But the team played, like how we did at Barcelona and Bayern, how I always want my teams to play. It is more important to me than winning a trophy."
Guardiola was also full of praise for January signing Gabriel Jesus. At just 20 years of age, Jesus has established himself as an instant hit at the Etihad.
The Brazilian, who joined from Palmeiras for £27m, has been involved in eight goals from nine appearances this season, relegating veteran Sergio Aguero to the bench as a result.
But having missed nearly 10 weeks of action after breaking a metatarsal in City’s 2-0 win at Bournemouth, Guardiola admitted that Jesus’ absence “hurt” his side “a lot”.
When asked about the youngster, Guardiola said: "Well, you from Brazil know him better than us. His impact was huge. He has desire, youth, and the mind to become a great player.
"He's Brazil's No. 9. It says everything. It was a pity that he couldn't play before January. We faced five, six months without him. I'm sorry the misfortune of the injury, which hurt us a lot, because it isn't 'either Gabriel or Sergio [Aguero]' They can perfectly play together.
"Certainly, with both of them, we would be stronger."
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