Paddon is one minute 18 seconds down on Meeke after a slow morning but improved performance on the afternoon loop.
"Okay, it's felt not so bad inside the car and with the driving, I feel we're making some good steps forward, but just haven't been producing the times," the New Zealander said.
"We're a little bit confused why that's happening at the moment, so we need to sit down with the engineers overnight and see if we can make some improvements overnight. But a long way to go, tomorrow's a big day.
"Of course we want to be up higher than seventh, so we'll see if we can try and improve on that tomorrow, and see if we can keep making steps forward."
Paddon's Hyundai teammate Thierry Neuville held a steady third place while the other Hyundai i20 of Dani Sordo dropped to fifth place on the final stage with Citroen's Craig Breen jumping into fourth.
Day 1 results
1. Kris Meeke (Citroen)
2. Sebastien Ogier (Ford) +10.3s
3. Thierry Neuville (Hyundai) +25.8s
4. Craig Breen (Citroen) +52.4s
5. Dani Sordo (Hyundai) +53.8s
6. Jari-Matti Latvala (Toyota) +1:00.2s
7. Hayden Paddon (Hyundai) +1:18.8s
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