The boss believes that City are not playing to their full potential, and was frustrated by a continued failure to convert a series of chances.
“We didn’t play well enough - we conceded two easy goals and didn’t take our chances to score,” said Pellegrini.
“The team ran a lot, tried to do things better but we couldn’t because we’re not in a good moment. I think Newcastle deserved to win, although we had four or five chances to score.”
The latest result followed a 2-1 loss at West Ham at the weekend and a disappointing 2-2 draw with CSKA Moscow in Russia and Pellegrini admitted it had been a bad week for the club.
He added: “We had three similar games. We conceded two goals in each game and we had a lot of chances from which we could have scored.
“In one sense we are conceding easy goals through individual mistakes but we also we are not playing the way we normally do.”
City suffered a further blow when David Silva was forced to come off with an injury early in the first half ahead of Sunday’s Manchester derby.
Manuel revealed that he will not know the extent of the problem until the Spaniard is assessed tomorrow, but defended his decision to name a strong line-up for this Capital One Cup clash four days ahead of the visit of Manchester United.
“We will see tomorrow,” said the Chilean. “David has a problem with his knee but I don’t know how serious it is.
“There was no reason why David cannot play. We played on Saturday and had four days to recover so I don’t think that was a reason. He was prepared to play but maybe not the whole game.
“For our team it is important to be involved in four competitions. A lot of people say this is not an important competition but for our team it was important to try and continue.”
However, the manager was keen to focus on the big picture for the rest of the season following the final whistle.
Quizzed on the recent run of results, Pellegrini was quick to point out that his side still have three trophies left to fight for.
He said: “We have a chance to continue in the Champions League if we improve in the way we are playing, and in the Premier League the same thing. The FA Cup we start in January.
“With one competition less we can concentrate more on the rest.”
