The mole revealed: "The nerves and the stress of the first few weeks definitely brought them closer together. Steve's now got his own apartment, which Nicole's been over to, and they seem to be virtually inseparable at the moment."
They added: "They can't go public until they get the okay from Simon. There has been talk of Steve getting a high-profile girlfriend as publicity for the show. It'll be great for ratings."
Despite these reports, a spokesperson for The X Factor USA has slammed the allegations, telling The Metro: "The suggestion that Steve and Nicole are romantically involved is pure fiction. They are friends, that’s it."
33-year old Scherzinger's representatives also stated: "Nicole is not dating Steve."
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