January 02, 2007 12:45 PM

Jessica Simpson and John Mayer are looking closer than ever after spending a whirlwind weekend in New York City.

The pair have dodged rumors of an off-and-on relationship for months, and they set tongues wagging again on New Year’s Eve when they arrived together in the Hudson Hotel’s VIP room just after 2:10 a.m.

The singers, who were out with a group of pals, according to a friend of Mayer’s, held court for about 40 minutes in a sofa nook across the room from Christina Aguilera’s entourage, which included her husband Jordan Bratman.

Simpson and Mayer later left together and hit Stereo nightclub for some more celebrating.

“It was a happy and fun New Year’s,” Mayer’s pal tells PEOPLE.

The two made it a weekend of hanging out together. They were spotted having dinner at the Mercer Kitchen on Friday, walking around Barneys New York on Saturday and also eating lunch at the Mexican restaurant Dos Caminos in SoHo, where “they were very flirty, obviously so engaged with each other,” an eyewitness tells PEOPLE.

Later Saturday night, Simpson and Mayer dropped by the nearby Comedy Cellar, where earlier in the week Mayer had performed a stand-up routine.

“They were friendly,” the Comedy Cellar’s manager, Estee Adorim, tells PEOPLE. “They were talking to everybody.”

In November, after the pair had been seen together several times in the Los Angeles area, a source close to Mayer told PEOPLE: “They’re fond of each other. There’s a flirtation.”

But a Simpson source said at the time, “There’s no title to their relationship.”

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