A brace from winger Djeidi Gassama and a strike on the counter from Wilson Odobert was enough to earn the Parisians all three points at the Academy Stadium.
Rico Lewis grabbed a late consolation, but it was to no avail, as City bowed out of the competition at the group stages.
"We started off reasonably well and had good spells in possession. I think PSG were very content to sit and try to counter because they're so potent on it," the EDS boss told City's website.
“In those situations, if our attacking play isn't precise or clinical, the number of attacks you have to defend is more than you want and they're dangerous.
“That was the theme of the first half and once they got the goal it had an even greater bearing on how the game developed.
“Our lads gave everything right until the end, but it was a difficult game for us.
“Throughout my career you can see some real magic moments in the difficult times, and I still saw at the end some really creative attacking play and incisive movement which was encouraging.
“We attacked right to the end, the challenge is always when the score is what it was, you want to go and score a goal but you realise the opponents' greatest strength is the moment you go forward, they can break.
“There's no embarrassment for me in terms of the score but there's obviously disappointment in terms of the result for the whole group and myself at the forefront of that."
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