I am leaning towards yes, he does. Note though that he, too, might not want to have things go a certain way because you are his report. It is not just a situation at work, it is a direct reporting relationship that is implicated. Policies on workplace romance differ somewhat from employer to employer, but romance between a subordinate and her manager is always off limits. It may not be the end of the world: maybe you just need to disclose it to HR and your assignment would get switched so that you would no longer report to him, but I thought it was worth mentioning that he might be being ambiguous with you (he is) because he is himself conflicted, and he is conflicted because you are his report.
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