Manchester City moved to the verge of the Champions League quarter-finals with a 2-0 win over Borussia Moenchengladbach on Wednesday but coach Pep Guardiola insisted his team still need to "be more clinical up front".

A first half header from Bernardo Silva and a Gabriel Jesus strike in the second period of the last 16 first leg tie extended a winning streak by Guardiola's high-flying side to 19 games in all competitions.

Premier League leaders City camped inside the Gladbach half for most of the game, which was moved to Hungary due to Germany's Covid-19 travel restrictions.

Although dominant, City took time to break down a stubborn German defence, often foiled by the interceptions of Algeria left-back Ramy Bensebaini. 

While Guardiola said afterwards he was "pleased" with the result, he added City "have to improve" to challenge for Champions League honours.

"We controlled the game. Unfortunately we were not clinical up front, it is something we have to improve in this competition, we were not good enough in the box, we didn't dribble and shoot enough," said Guardiola. 

"In this competition you have to be perfect to be sure you can go through," he said.

Debutants in the Champions League knockout stages, Gladbach had been urged by coach Marco Rose to be brave against Guardiola's side.

France's Alassane Plea was almost through on goal on 20 minutes after a rare counterattack, but a nervy and deep-lying Gladbach eventually succumbed to mounting pressure in the 29th minute.

A sublime inch-perfect cross by Portuguese defender Joao Cancelo curled over the defence from the left to reach his compatriot Silva who flicked his close-range header past Yann Sommer.

"We tried to play simple and not make mistakes. It's a good win for us, but it's not over yet," Silva told BT Sport.

"Every time when he plays (Silva) is an exceptional player, he's really good in the air, the goal was fantastic how he finished it," said Guardiola.

The 26-year-old Cancelo, impressive throughout, nearly doubled the lead five minutes from the break but his shot from just outside the box pinged over the bar.

Then early in the second half Jesus should have converted after latching on to a poorly judged backpass by Bensebaini but saw his shot blocked by Swiss defender Nico Elvedi.

Apart from a lunging backheel from Plea that flashed just wide of Ederson's far post on the hour mark, City comfortably contained the Germans, and went two up in the 65th minute.

Another majestic cross-field pass by Cancelo again found Silva at Sommer's far post who this time headed back across the goalmouth for Jesus to fire home and seal City's 19th successive victory and sixth Champions League clean sheet in a row.

Gladbach, who managed just one shot on target throughout the game, an effort by substitute Hannes Wolf saved by Ederson in the last moments, now face a formidable task to turn around the tie in the return leg scheduled for March 16 in Manchester. 

"We deservedly lost today against a very strong team, you don't get many chances against such an opponent, we simply couldn't attack more," said Rose

"It would have been good to score at the end to be in a better position."

Ferland Mendy scored late as Real Madrid beat 10-man Atalanta 1-0 on Wednesday to close in on the Champions League quarter-finals.

The French left-back's strike in Bergamo came four minutes from time in a last 16 first leg game which the hosts played a man down for over 70 minutes as Zinedine Zidane's side hold the advantage heading into the second leg in Madrid on March 16.

Atalanta had attacked early but the game was transformed when Swiss midfielder Remo Freuler was harshly send off on 17 minutes for tripping Mendy at the edge of the penalty area.

Gian Piero Gasperini's woes continued with forward Duvan Zapata limping off after half an hour with a muscular problem with midfielder Mario Pasalic coming off the bench.

Spanish midfielder Isco got a rare start up front for injury-hit Real Madrid playing alongside Marco Asensio and Vinicius.

The 13-time European champions were without striker Karim Benzema due to an ankle problem with an injury list also including Sergio Ramos, Eden Hazard and Dani Carvajal.

But Zidane's side failed to make the most of the extra man despite coming closest to breaking through in the first half with a Casemiro header, with Nacho, Isco and Vinícius Junior also threatening and Luka Modric sending over the goal.

Zapata and in-form Luis Muriel lead the Atalanta attack in their first meeting with Real Madrid.

Atalanta continued to attack, with Muriel missing a chance to give the hosts the advantage four minutes before the break with a long-range strike that went just wide.

Atalanta goalkeeper Pierluigi Gollini kept the hosts in the game keeping out a Casemiro header on a free kick before the half-time whistle.

Modric sent wide of the post after the break and sent through for Vinícius but was headed away from the Brazilian. 

Josip Illicic came on in place of Muriel after 56 minutes.

The Slovenian scored five goals against Valencia at this stage of the competition last season, but was substituted off four minutes from time after a poor display.

Soon afterwards Madrid broke through thanks to Mendy, who beat Gollini with a stunning curling effort into the top corner.

Real have the advantage going into the second leg having missed out on the quarter-finals for the last two seasons.

Atalanta need a historic effort in the away leg to reach the last eight for a second successive year.

The Bergamo side won their last 16, first leg clash against Valencia 4-1 a year ago on front of 45,000 spectators in Milan's San Siro.

That match was considered to have been one of the reasons behind the acceleration of the virus in Italy with Bergamo at the epicentre of the country's outbreak.

The were playing their second Champions League campaign, but the first knock-out match in their home stadium which underwent renovations last season when they reached the last eight.

And thousands of fans ignored the Italian team's plea to stay away with a party atmosphere outside the stadium with a fireworks display.