Liam Hemsworth
Cast member Liam Hemsworth poses with his (former) fiancee, singer Miley Cyrus (R), at the premiere of "Paranoia" in Los Angeles, California August 8, 2013. The movie opens in the U.S. on August 16. Reuters/Mario Anzuoni

Speculations of a romance rekindling between formerly engaged couple Miley Cyrus and Liam Hemsworth are fueling Hollywood’s rumour mill.

The two stars were seen very affectionate together during the Falls Music Festival in Australia’s Byron Bay on Sunday, January 2. According to the Daily Telegraph, Miley and former fiance Liam were spotted on Sunday night walking together to the VIP area with Liam’s brothers and their wives, namely Chris Hemsworth with wife Elsa Pataky and Luke with wife Samantha.

Miley and the “Hunger Games: Mockingjay Part 2” actor reportedly spent around half an hour at the VIP area, drinking with their friends. Afterwards, both proceeded to the general viewing area to watch Disclosure’s more than one hour set. The two stars were said to be very cosy with one another, however, the formerly engaged couple were surrounded by security personnel which prevented fans from taking photos, Daily Telegraph reports.

A source also told E News that Miley and Liam were seen “cuddling and kissing” during the music event. Another insider shared with E News that the two were “affectionate” which each other while backstage at the VIP area. The insider added that the Australian actor was “seen rubbing Miley’s back at one point.”

Meanwhile, a few fans at the event also took to social media to share the news, Us Weekly reported. Twitter user Ashleigh who spotted the Miley and Liam at Byron Bay’s Falls Music Festival wrote, “#BREAKING I spy with my lil eye @MileyCyrus and @LiamHemsworth backstage at falls festival Byron bay hmmmmm #backon #gossip.”

The “Wrecking Ball” singer and Liam first met while filming the 2010 movie “The Last Song.” The two eventually became a couple and got engaged in 2012. However, Miley and Liam broke their engagement in 2013. Both stars have remained friends despite the break up.