Unclear Which folders count as untrusted, and exactly what Claude Code does with settings from them, is not stated.
What
When auto mode, which lets Claude act without asking you each time, makes a decision, the result can now carry the rule that applied: which list it came from (allow or soft_deny) and the rule's name.
Separately, when Claude Code checks where a permission setting came from, it can now answer untrusted_folder. Before, the only answers were managed rules only or your personal configuration.
Why
Configuration that comes from a folder Claude Code does not trust can now be singled out instead of being treated like your own settings.
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The writer flagged doubt
Which folders count as untrusted, and exactly what Claude Code does with settings from them, is not stated.