Despite losing I still think that Manchester City will win the league. Their bench is worth over 300 million and their on field players are closer to a billion. No other team in the league can compete with that and they will probably add to their team before the transfer window closes.
The quality of a squad is not the only thing that is important for success. The management of a team is more important than it actually. But we know that their manager is Guardiola and his system has been marvelous so far. Maybe they still haven't won the CL title. But they have been doing great in the EPL. And I agree with you on that they will still become the champions this season despite losing against Tottenham. It was already a tough match and not a surprising results. Tottenham have been beating them here for 3 games in the end.