"I still think it is between City and Liverpool," said James on the We're Not Really Here podcast.
"I always felt Liverpool were going to drop points and I think City still will too.
"The emotional balance that Arsenal have will be their downfall because their ability to control it seems a bit loose. I don't think they're in the race anyway, but it will keep them out of it.
"Liverpool will do what they've done very well all season, but you look at City and everything is looking right. The only issue they'll have is if they believe the hype themselves and think they'll have a great end without having to earn it.
"They just have to carry on."