• Copilot Chat Extension Version: v0.30.2025071701
• VS Code Version: 1.103.0-insiders
• OS Version: Windows 11
• Feature (e.g. agent/edit/ask mode): Agent
• Selected model (e.g. GPT 4.1, Claude 3.7 Sonnet): Sonnet 4

The agent doesn't properly handle having a "normal" terminal session and a "background" terminal session in different directories.

In my scenario, I am working on a repo that has a folder "packages/frontend" which contains my... frontend.
When tasking the agent with working on a frontend issue, it went into this folder on the terminal :

However, when it tries to start it in a background terminal, it thinks this terminal is already there, when it's not:

The agent is being told by the tools it seems that the path is correct:

However, even if you try to tell it to cd into it first, the recently added feature of "stripping the cd from the command" is messing it up:

I don't have time to grab the full debug logs and prompts (and censor them accordingly), but if needed to fix this, let me know.

@isidorn