Watmore only moved to Sunderland in the summer from Altrincham.
"I don't think I'm ready for the Sunderland first team," he said. "For my development, the next stage was definitely to come and get first-team experience.
"Hibs is a really good club to get experience at and I'm very grateful for the chance.
"Everything I learn here will make me a better player.
"Gaining first-team experience is the main thing for me now."
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