Wenger's side had a dismal record against the Premier League's top clubs last season and humiliating defeats at Chelsea, Liverpool and City ended the Gunners' hopes of challenging for their first English crown since 2004.
But the Arsenal manager believes his team's performance in recovering to secure a 2-2 draw after falling two goals behind at Everton last month highlighted their greater resilience this season.
And a win against Manuel Pellegrini's side at the Emirates Stadium would, in Wenger's view, confirm that his players are ready to face the main title contenders on equal terms.
"It's a good opportunity to show that we have improved on that front," said Wenger.
"I don't think that this game is very important for us mathematically just because we dropped points away from home at Everton and Leicester.
"But it gives us credibility and confidence if we do well. It's a big game and for us it is a home game as well.”
Zabaleta signals Sanchez as main threat
City defender Pablo Zabaleta has singled out Alexis Sanchez as the key man to stop. Sanchez joined the Gunners from Barcelona for £35 million in the close-season and Zabaleta reckons the Chile winger will pose the greatest threat to City.
"Sanchez is a very quick, sharp player who can play wide or as a striker but I feel he is most dangerous when he is on the flanks," he said.
"You know you are in for a tough afternoon when you face him. He is a great signing for Arsenal."
Argentina international Zabaleta also believes City's players have regained much of their match sharpness as they look to respond from a shock 1-0 home defeat to Stoke City last time out.
"We are much stronger than we were a month ago and we will continue to improve and get back into our stride as each game goes by," he added.
Rodgers backs Reds to cope with hectic schedule
Brendan Rodgers is confident Liverpool can handle the strain of a hectic period which starts with their Premier League clash against Aston Villa on Saturday.
The Reds have five fixtures in three different competitions, including a return to the Champions League after a five-year hiatus, over the course of a next fortnight which will put Rodgers' new-look squad to the test.
Liverpool boss Rodgers recruited 10 players during the close-season and he expects those new arrivals will play a key role in the frantic next 14 days.
"It's very important to be able to rotate, but also to maintain the consistency from the team and I think the best sides are able do that," said Rodgers.
"We've planned the teams out for the next five games all the way through to Everton, but of course you have to allow for injuries and such."
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