Capello's statements come on the background of the Three Lion's 2-1 friendly win over Germany in Berlin, where goals from Matthew Upson and John Terry cancelled out Patrick Helmes' strike for the hosts.
"I cannot have imagined a better year in charge. I think it would have been impossible to be better than this,"
Capello was quoted as saying by the Guardian on Thursday.
"We've played 10 games and, after every game, I've seen the players taking another step forward.
Capello had to start the Germany exhibition without Steven Gerrard, Rio Ferdinand, Wayne Rooney, Frank Lampard and Theo Walcott, who were all injured. However, the former Juventus tactician was impressed by his replacement options.
Aston Villa's Gabriel Agbonlahor, Stuart Downing of Middlesbrough and West Ham defender Mathew Upson were given rare starts, and they have shown Capello their real worth.
"I'm very happy because today I saw some players play very well and I needed to know them better.
"Now I have a selection problem, but it's a very good problem. We still have time to decide who'll be in the next squad anyway," added Capello.