City swept to the top of the table ahead of the Gunners with a 5-1 thrashing of Tottenham at White Hart Lane in midweek.
Arsenal, though, could steal a march on their rivals by beating Crystal Palace on Sunday, with City set to host third-placed Chelsea on Monday night.
Wenger accepts City have assembled an impressive squad, but one he maintains is not without a chink in their armour - echoing the comments of Blues boss Jose Mourinho, who felt Manuel Pellegrini's men had got "lucky" with some refereeing decisions.
"Man City are the team of the moment, so everybody goes to definite conclusions," said Wenger, whose side drew 2-2 at Southampton on Tuesday.
"I don't deny their strength, quality and the exceptional players they have, but let's not forget they have lost four away games, so they must have some vulnerability."
Wenger continued: "On the fixture front, they have more difficult fixtures than we have.
"Yes, they are the favourites. I agree with that at the moment. You cannot say that a team that scores over 100 goals has no quality.
"They are top quality, but it is an even bigger target and scalp for us to get in front of them.
"It would be absolutely fantastic and I think we can do it."
Arsenal are heading into a run of fixtures which could well define their campaign, tackling Liverpool, Manchester United, Tottenham and Chelsea before City come to the Emirates on March 29 - by which time they will also have faced Bayern Munich in the last 16 of the Champions League and the Reds again in the fifth round of the FA Cup.
Wenger, though, remains ever positive in the ability of his squad - boosted by the deadline-day arrival of Sweden midfielder Kim Kallstrom on loan from Spartak Moscow - to rise to the challenge.
"Yes, we have (to play the big teams), but as well, it is a good opportunity for us," he said.
"We play Man Utd at home, Man City at home, we go to Chelsea, Liverpool and Tottenham, but if you look at our away record it is very good, so we know that away from home we can do very well.
"Since December, I have said to the players, the Emirates will decide our season.
"The crowd is on our side much more this year, they were much more patient."
Wenger added: "We have more experience now and the depth in the squad will be good because of the players coming back (from injury).
"If we can get over this period where we have no (Aaron) Ramsey, no (Jack) Wilshere and after they come back fresh that can be a big boost for the end of the season."